Century Communities, Inc. (Form: 10-Q, Received: 04/25/2024 06:02:30)

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-36491

Century Communities, Inc.

(Exact name of registrant as specified in its charter)


Delaware		68-0521411
(State or other jurisdiction of ‎incorporation or organization)		(I.R.S. Employer ‎Identification No.)

8390 East Crescent Parkway, Suite 650 ‎Greenwood Village, CO		80111
(Address of principal executive offices)		(Zip Code)

(Registrant’s telephone number, including area code): (303) 770-8300

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common stock, par value $0.01 per share	CCS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

On April 19, 2024, 31,790,755 shares of common stock, par value $0.01 per share, of the registrant were outstanding.

Table of Contents

CENTURY COMMUNITIES, INC.

FORM 10-Q

For the Three Months Ended March 31, 2024

Index


	Page No.
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of March 31, 2024 (unaudited) and December 31, 2023 (audited)	3
Unaudited Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2024 and 2023	4
Unaudited Condensed Consolidated Statements of Cash Flows for Three Months Ended March 31, 2024 and 2023	5
Unaudited Condensed Consolidated Statements of Stockholders' Equity for the Three Months Ended March 31, 2024 and 2023	6
Notes to the Unaudited Condensed Consolidated Financial Statements	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3. Quantitative and Qualitative Disclosures About Market Risk	37
Item 4. Controls and Procedures	37
PART II – OTHER INFORMATION
Item 1. Legal Proceedings	37
Item 1A. Risk Factors	37
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3. Defaults Upon Senior Securities	38
Item 4. Mine Safety Disclosures	38
Item 5. Other Information	38
Item 6. Exhibits	40
Signatures	41

Table of Contents

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

Century Communities, Inc.

Condensed Consolidated Balance Sheets

As of March 31, 2024 and December 31, 2023

(in thousands, except share and per share amounts)



	March 31,		December 31,
	2024		2023
Assets	(unaudited)		(audited)
Cash and cash equivalents	$	122,840	$	226,150
Cash held in escrow		84,776		101,845
Accounts receivable		65,995		76,213
Inventories		3,107,133		3,016,641
Mortgage loans held for sale		217,702		251,852
Prepaid expenses and other assets		388,801		350,193
Property and equipment, net		74,647		69,075
Deferred tax assets, net		17,601		16,998
Goodwill		32,082		30,395
Total assets	$	4,111,577	$	4,139,362
Liabilities and stockholders' equity
Liabilities:
Accounts payable	$	135,784	$	147,265
Accrued expenses and other liabilities		274,308		303,392
Notes payable		1,069,762		1,062,471
Revolving line of credit		—		—
Mortgage repurchase facilities		212,447		239,298
Total liabilities		1,692,301		1,752,426
Stockholders' equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized, none outstanding		—		—
Common stock, $0.01 par value, 100,000,000 shares authorized, 31,790,585 and 31,774,615 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively		318		318
Additional paid-in capital		569,581		592,989
Retained earnings		1,849,377		1,793,629
Total stockholders' equity		2,419,276		2,386,936
Total liabilities and stockholders' equity	$	4,111,577	$	4,139,362

See Notes to Unaudited Condensed Consolidated Financial Statements

Table of Contents

Century Communities, Inc.

Unaudited Condensed Consolidated Statements of Operations

For the Three Months Ended March 31, 2024 and 2023

(in thousands, except share and per share amounts)



	Three Months Ended March 31,
	2024		2023
Revenues
Homebuilding revenues
Home sales revenues	$	922,402	$	735,600
Land sales and other revenues		1,216		1,535
Total homebuilding revenues		923,618		737,135
Financial services revenues		24,925		15,855
Total revenues		948,543		752,990
Homebuilding cost of revenues
Cost of home sales revenues		(725,570)		(601,385)
Cost of land sales and other revenues		(37)		—
Total homebuilding cost of revenues		(725,607)		(601,385)
Financial services costs		(14,877)		(10,781)
Selling, general and administrative		(114,109)		(98,313)
Other income (expense)		(9,630)		1,498
Income before income tax expense		84,320		44,009
Income tax expense		(19,988)		(10,698)
Net income	$	64,332	$	33,311

Earnings per share:
Basic	$	2.02	$	1.04
Diluted	$	2.00	$	1.04
Weighted average common shares outstanding:
Basic		31,808,959		31,914,414
Diluted		32,238,808		32,117,082

See Notes to Unaudited Condensed Consolidated Financial Statements

Table of Contents

Century Communities, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

For the Three Months Ended March 31, 2024 and 2023

(in thousands)


	Three Months Ended March 31,
	2024		2023
Operating activities
Net income	$	64,332	$	33,311
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		5,475		3,292
Stock-based compensation expense		2,796		5,360
Fair value of mortgage loans held for sale and other		(2,443)		205
Impairment on other investment		7,722		—
Purchase price accounting for acquired work in process inventory		1,581		—
Abandonment of lot option contracts		762		638
Deferred income taxes		(603)		(83)
Loss on disposition of assets		274		198
Changes in assets and liabilities:
Cash held in escrow		17,069		43,878
Accounts receivable		10,823		10
Inventories		(68,001)		90,152
Mortgage loans held for sale		29,118		48,241
Prepaid expenses and other assets		(7,050)		8,247
Accounts payable		(11,592)		(401)
Accrued expenses and other liabilities		(28,671)		(41,714)
Net cash provided by operating activities		21,592		191,334
Investing activities
Purchases of property and equipment		(5,922)		(4,820)
Expenditures related to development of rental properties		(25,950)		(16,268)
Business combination and other investing activities		(32,716)		152
Net cash used in investing activities		(64,588)		(20,936)
Financing activities
Borrowings under revolving credit facilities		211,000		—
Payments on revolving credit facilities		(211,000)		—
Borrowing under construction loan agreements		15,972		7,137
Proceeds from issuance of insurance premium notes and other		11,166		3,032
Principal payments on insurance premium notes and other		(20,245)		(3,364)
Net proceeds (payments) for mortgage repurchase facilities		(26,851)		(47,842)
Withholding of common stock upon vesting of stock-based compensation awards		(10,415)		(9,880)
Repurchases of common stock under stock repurchase program		(16,109)		—
Dividend payments		(8,264)		(7,365)
Other financing activities		—		—
Net cash used in financing activities		(54,746)		(58,282)
Net increase (decrease)	$	(97,742)	$	112,116
Cash and cash equivalents and Restricted cash
Beginning of period		242,003		308,492
End of period	$	144,261	$	420,608
Supplemental cash flow disclosure
Cash paid for income taxes	$	—	$	—
Cash and cash equivalents and Restricted cash
Cash and cash equivalents	$	122,840	$	405,722
Restricted cash (Note 5)		21,421		14,886
Cash and cash equivalents and Restricted cash	$	144,261	$	420,608

See Notes to Unaudited Condensed Consolidated Financial Statements

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Century Communities, Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity

For the Three Months Ended March 31, 2024 and 2023

(in thousands)


	Common Stock
	Shares	Amount		Additional Paid-In Capital		Retained Earnings		Total Stockholders' Equity
Balance at December 31, 2023	31,775	$	318	$	592,989	$	1,793,629	$	2,386,936
Vesting of stock-based compensation awards	323		3		(3)		—		—
Withholding of common stock upon vesting of stock-based compensation awards	(120)		(1)		(10,414)		—		(10,415)
Repurchases of common stock	(187)		(2)		(16,107)		—		(16,109)
Stock-based compensation expense	—		—		2,796		—		2,796
Cash dividends declared and dividend equivalents	—		—		320		(8,584)		(8,264)
Net income	—		—		—		64,332		64,332
Balance at March 31, 2024	31,791	$	318	$	569,581	$	1,849,377	$	2,419,276


Balance at December 31, 2022	31,773	$	318	$	584,803	$	1,565,094	$	2,150,215
Vesting of stock-based compensation awards	412		4		(4)		—		—
Withholding of common stock upon vesting of stock-based compensation awards	(159)		(2)		(9,878)		—		(9,880)
Stock-based compensation expense	—		—		5,360		—		5,360
Cash dividends declared and dividend equivalents	—		—		208		(7,573)		(7,365)
Net income	—		—		—		33,311		33,311
Balance at March 31, 2023	32,026	$	320	$	580,489	$	1,590,832	$	2,171,641

See Notes to Unaudited Condensed Consolidated Financial Statements

‎

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Century Communities, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

March 31, 2024

1. Basis of Presentation

Century Communities, Inc. (which we refer to as “we,” “CCS,” or the “Company”), together with its subsidiaries, is engaged in the development, design, construction, marketing and sale of single-family attached and detached homes in 18 states. In many of our projects, in addition to building homes, we entitle and develop the underlying land. We build and sell homes under our Century Communities and Century Complete brands. Our Century Communities brand has an emphasis on serving the entry-level homebuilding market but offers a wide range of buyer profiles including: entry-level, first and second time move-up, and lifestyle homebuyers, and provides our homebuyers with the ability to personalize their homes through certain option and upgrade opportunities. Our Century Complete brand targets entry-level homebuyers, primarily sells homes through retail studios and the internet, and generally provides no option or upgrade opportunities.

Our homebuilding operations are organized into the following five reportable segments: West, Mountain, Texas, Southeast, and Century Complete. Our indirect wholly-owned subsidiaries, Inspire Home Loans Inc., Parkway Title, LLC, IHL Home Insurance Agency, LLC, and IHL Escrow Inc., which provide mortgage, title, insurance and escrow services, respectively, primarily to our homebuyers, have been identified as our Financial Services segment. Additionally, our wholly owned subsidiary, Century Living, LLC, is engaged in the development, construction and management of multi-family rental properties, currently all located in Colorado. Century Living, LLC is included in our Corporate segment.

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (which we refer to as “GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (which we refer to as the “SEC”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring adjustments necessary for a fair presentation of our financial position and results of operations for the periods presented. Interim results of operations are not necessarily indicative of the results that may be achieved for the full year. The financial statements and related notes do not include all information and footnotes required by GAAP and should be read in conjunction with the consolidated financial statements for the year ended December 31, 2023, which are included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 that was filed with the SEC on February 5, 2024.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company, as well as all subsidiaries in which we have a controlling interest, and variable interest entities for which the Company is deemed to be the primary beneficiary. We do not have any variable interest entities in which we are deemed the primary beneficiary.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Accordingly, actual results could differ from those estimates.

Business Acquisition

On January 22, 2024, we closed on the acquisition of substantially all the assets of Landmark Homes of Tennessee, Inc. (“Landmark”), a homebuilder with operations, including six active communities, in Nashville, Tennessee, for approximately $33.4 million in cash, inclusive of customary holdbacks.

Recently Issued Accounting Standards

In December 2023, the Financial Accounting Standards Board (which we refer to as “FASB”) issued Accounting Standards Update (which we refer to as “ASU”) No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”). ASU 2023-09 requires more disaggregated income tax disclosures, including additional information in the rate reconciliation and additional disclosures about income taxes paid. ASU 2023-09 will become effective for us for the fiscal year ending December 31, 2025. Early adoption is permitted, and guidance should be applied prospectively, with an option to apply guidance retrospectively. We are currently evaluating the impact of the adoption of ASU 2023-09 on our consolidated financial statements and related disclosures.

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In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”). ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (which we refer to as “CODM”) and included within each reported measure of segment profit or loss. The guidance also expands disclosure requirements for interim periods, as well as requires disclosure of other segment items, including the title and position of the entity’s CODM. ASU 2023-07 will become effective for us for the fiscal year ending December 31, 2024, and for interim periods starting in our first quarter of 2025. Early adoption is permitted, and guidance is required to be applied retrospectively. We are currently evaluating the impact of the adoption of ASU 2023-07 on our consolidated financial statements and related disclosures.

2. Reporting Segments

Our homebuilding operations are engaged in the development, design, construction, marketing and sale of single-family attached and detached homes in 18 states. We build and sell homes under our Century Communities and Century Complete brands. Our Century Communities brand is managed by geographic location, and each of our four geographic regions offers a wide range of buyer profiles including: entry-level, first and second time move-up, and lifestyle homebuyers, and provides our homebuyers with the ability to personalize their homes through certain option and upgrade selections. Each of our four geographic regions is considered a separate operating segment. Our Century Complete brand targets entry-level homebuyers, primarily sells homes through retail studios and the internet, and generally provides no option or upgrade selections. Our Century Complete brand currently has operations in 11 states and it is considered a separate operating segment.

The management of our four Century Communities geographic regions and Century Complete reports to our chief operating decision makers (which we refer to as “CODMs”), the Co-Chief Executive Officers of our Company. The CODMs review the results of our operations, including total revenue and income before income tax expense to determine profitability and to allocate resources. Accordingly, we have presented our homebuilding operations as the following five reportable segments:

West (California and Washington)

Mountain (Arizona, Colorado, Nevada, and Utah)

Texas

Southeast (Alabama, Florida, Georgia, North Carolina, South Carolina, and Tennessee)

Century Complete (Alabama, Arizona, Florida, Georgia, Indiana, Kentucky, Louisiana, Michigan, North Carolina, Ohio, South Carolina)

We have identified our Financial Services operations, which provide mortgage, title, insurance and escrow services to our homebuyers, as a sixth reportable segment. Our Corporate operations are a non-operating segment, as our Corporate operations serve to support our homebuilding, and to a lesser extent our Financial Services operations, through functions, such as our executive, finance, treasury, human resources, accounting and legal departments.

Additionally, our wholly owned subsidiary, Century Living, LLC, is engaged in the development, construction and management of multi-family rental properties, currently all located in Colorado. Century Living, LLC is included in our Corporate segment.

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The following table summarizes total revenue and income (loss) before income tax expense by segment (in thousands):




	Three Months Ended March 31,
	2024		2023
Revenue:
West	$	172,648	$	129,081
Mountain		254,279		246,275
Texas		131,273		89,532
Southeast		161,658		87,126
Century Complete		203,760		185,121
Financial Services		24,925		15,855
Corporate		—		—
Total revenue	$	948,543	$	752,990

Income (loss) before income tax expense:
West	$	26,707	$	7,973
Mountain		27,808		27,808
Texas		13,872		3,673
Southeast		20,796		11,966
Century Complete		21,101		13,950
Financial Services		10,048		5,074
Corporate		(36,012)		(26,435)
Total income before income tax expense	$	84,320	$	44,009

The following table summarizes total assets by segment (in thousands):



	March 31,		December 31,
	2024		2023
West	$	787,198	$	786,489
Mountain		1,050,830		1,051,052
Texas		617,785		577,129
Southeast		542,895		503,249
Century Complete		417,352		386,444
Financial Services		397,700		450,208
Corporate		297,817		384,791
Total assets	$	4,111,577	$	4,139,362

Corporate assets primarily include costs associated with development of multi-family rental properties, certain cash and cash equivalents, certain property and equipment, deferred tax assets, certain receivables, and prepaid insurance.

3. Inventories

Inventories included the following (in thousands):



	March 31,		December 31,
	2024		2023
Homes under construction	$	1,386,300	$	1,334,584
Land and land development		1,645,661		1,609,459
Capitalized interest		75,172		72,598
Total inventories	$	3,107,133	$	3,016,641

4. Financial Services

Our Financial Services are principally comprised of our mortgage lending operations, Inspire Home Loans Inc. (which we refer to as “Inspire”). Inspire is a full-service mortgage lender and primarily originates mortgage loans for our homebuyers. Inspire sells substantially all of the loans it originates either as loans with servicing rights released, or with servicing rights retained, in the secondary mortgage market within a short period of time after origination, generally within 30 days. Inspire primarily finances these loans using its mortgage repurchase facilities.

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Mortgage loans held for sale and mortgage servicing rights are carried at fair value, with gains and losses from the changes in fair value reflected in financial services revenue on the consolidated statements of operations. Management believes carrying mortgage loans held for sale at fair value improves financial reporting by mitigating volatility in reported earnings caused by measuring the fair value of the loans and the derivative instruments used to economically hedge them. Net gains and losses from the sale of mortgage loans held for sale, which are recognized based upon the difference between the sales proceeds and carrying value of the related loans upon sale, are also included in financial services revenue on the consolidated statements of operations. Financial services revenue also includes fees earned from originating mortgage loans which are recognized at the time the mortgage loans are funded, which include origination fees and discount points to reduce interest rates based on commitment agreements entered into between our homebuilding and Financial Services segments.

As of March 31, 2024 and December 31, 2023, Inspire had mortgage loans held for sale with an aggregate fair value of $217.7 million and $251.9 million, respectively, and an aggregate outstanding principal balance of $218.6 million and $247.7 million, respectively. Net gains on the sale of mortgage loans were $2.0 million and $1.8 million for the three months ended March 31, 2024 and 2023, respectively. The loss from the change in fair value for mortgage loans held for sale was $5.0 million for the three months ended March 31, 2024, and was nominal for the three months ended March 31, 2023.

Mortgage loans in process for which interest rates were locked by borrowers, or interest rate lock commitments, totaled approximately $147.1 million and $49.6 million at March 31, 2024 and December 31, 2023, respectively, and carried a weighted average interest rate of approximately 5.5% and 5.8%, respectively. Interest rate risks related to these obligations are typically mitigated through our interest rate hedging program or by the preselling of loans to investors. Derivative instruments used to economically hedge our market and interest rate risk are carried at fair value. Derivative instruments typically include interest rate lock commitments and forward commitments on mortgage-backed securities. Changes in fair value of these derivatives as well as any gains or losses upon settlement are reflected in financial services revenue on our condensed consolidated statements of operations. Refer to Note 12 – Fair Value Disclosures for further information regarding our derivative instruments.

5. Prepaid Expenses and Other Assets

Prepaid expenses and other assets included the following (in thousands):


	March 31,		December 31,
	2024		2023
Prepaid insurance	$	36,824	$	37,624
Lot option and escrow deposits		64,117		51,369
Performance deposits		8,734		10,170
Restricted cash ⁽¹⁾		21,421		15,853
Multi-family rental properties under construction		160,213		136,300
Mortgage loans held for investment at fair value		21,620		21,041
Mortgage loans held for investment at amortized cost		6,778		6,826
Mortgage servicing rights		32,734		30,932
Derivative assets		3,790		1,618
Other assets and prepaid expenses		32,570		38,460
Total prepaid expenses and other assets	$	388,801	$	350,193

(1)Restricted cash consists of restricted cash related to land development, earnest money deposits for home sale contracts held by third parties as required by various jurisdictions, and certain compensating balances associated with our mortgage repurchase facilities and other financing obligations.

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6. Accrued Expenses and Other Liabilities

Accrued expenses and other liabilities included the following (in thousands):



	March 31,		December 31,
	2024		2023
Earnest money deposits	$	14,402	$	7,933
Warranty reserve		11,212		11,524
Self-insurance reserve		25,652		23,659
Accrued compensation costs		33,657		80,133
Land development and home construction accruals		121,314		120,224
Accrued interest		14,324		10,404
Income taxes payable		8,464		—
Derivative liabilities		979		5,291
Other accrued liabilities		44,304		44,224
Total accrued expenses and other liabilities	$	274,308	$	303,392

7. Warranties

Estimated future direct warranty costs are accrued and charged to cost of home sales revenues in the period when the related home sales revenues are recognized. Amounts accrued, which are included in accrued expenses and other liabilities on the condensed consolidated balance sheets, are based upon historical experience rates. We subsequently assess the adequacy of our warranty accrual on a quarterly basis through a model that incorporates historical payment trends and adjust the amounts recorded, if necessary. Based on warranty payment trends relative to our estimates at the time of home closing, we reduced our warranty reserve by $1.3 million and $0.5 million during the three months ended March 31, 2024 and 2023, respectively. These adjustments are included in cost of home sales revenues on our condensed consolidated statements of operations. Changes in our warranty accrual for the three months ended March 31, 2024 and 2023 are detailed in the table below (in thousands):



	Three Months Ended March 31,
	2024		2023
Beginning balance	$	11,524	$	13,136
Warranty expense provisions		2,670		1,829
Payments		(1,691)		(2,176)
Warranty adjustment		(1,291)		(458)
Ending balance	$	11,212	$	12,331

8. Self-Insurance Reserve

We maintain general liability insurance coverage, including coverage for certain construction defects after homes have closed and premise operations during construction. These insurance policies protect us against a portion of the risk of loss from claims, subject to certain self-insured per occurrence and aggregate retentions, deductibles, and available policy limits. In circumstances where we have elected to retain a higher portion of the overall risk for construction defect claims in return for a lower initial premium, we reserve for the estimated self-insured retention costs that we will incur that are above our coverage limits or that are not covered by our insurance policies. The reserve is recorded on an undiscounted basis at the time revenue is recognized for each home closing. Amounts accrued, which are included in accrued expenses and other liabilities on the condensed consolidated balance sheets, are based on third party actuarial analyses that are primarily based on industry data and partially on our historical claims, which include estimates of claims incurred but not yet reported. Adjustments to estimated reserves are recorded in the period in which the change in estimate occurs. Our self-insurance liability is presented on a gross basis without consideration of insurance recoveries and amounts we have paid on behalf of and expect to recover from other parties, if any. Estimates of insurance recoveries and amounts we have paid on behalf of and expect to recover from other parties, if any, are recorded as receivables when such recoveries are considered probable. During the three months ended March 31, 2024 and 2023, we recorded no change to our self-insurance reserve. Any adjustments are included in cost of home sales revenues on our condensed consolidated statements of operations.

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Changes in our self-insurance reserve for incurred but not reported construction defect claims for the three months ended March 31, 2024 and 2023 are detailed in the table below (in thousands):



	Three Months Ended March 31,
	2024		2023
Beginning balance	$	23,659	$	16,998
Self-insurance expense provisions		2,511		2,115
Payments		(518)		(37)
Self-insurance adjustment		—		—
Ending balance	$	25,652	$	19,076

9. Debt

Our outstanding debt obligations included the following as of March 31, 2024 and December 31, 2023 (in thousands):


	March 31,		December 31,
	2024		2023
3.875% senior notes, due August 2029⁽¹⁾	$	495,849	$	495,656
6.750% senior notes, due June 2027⁽¹⁾		497,414		497,210
Other financing obligations⁽²⁾		76,499		69,605
Notes payable		1,069,762		1,062,471
Revolving line of credit		—		—
Mortgage repurchase facilities		212,447		239,298
Total debt	$	1,282,209	$	1,301,769

⁽¹⁾The carrying value of senior notes reflects the impact of premiums, discounts, and issuance costs that are amortized to interest expense over the respective terms of the senior notes.

⁽²⁾As of March 31, 2024, other financing obligations included $15.6 million related to insurance premium notes and certain secured borrowings, as well as $60.9 million outstanding under construction loan agreements. As of December 31, 2023, other financing obligations included $24.7 million related to insurance premium notes and certain secured borrowings, as well as $44.9 million outstanding under construction loan agreements.

Construction Loan Agreements

Certain wholly owned subsidiaries of Century Living, LLC, are parties to construction loan agreements with various banks, (which we collectively refer to as “the lenders”). These construction loan agreements collectively provide that we may borrow up to an aggregate of $187.6 million from the lenders for purposes of construction of multi-family projects in Colorado, with advances made by the lenders upon the satisfaction of certain conditions. Borrowings under the construction loan agreements bear interest at various rates, including a fixed rate, and floating interest rates per annum equal to the Secured Overnight Financing Rate (which we refer to as “SOFR”) and the Bloomberg Short-term Bank Yield Index, plus an applicable margin. The outstanding principal balances and all accrued and unpaid interest is due on varying maturity dates from March 17, 2026 through March 17, 2028, with certain of the construction loan agreements allowing for the option to extend the maturity dates for a period of 12 months if certain conditions are satisfied. The construction loan agreements contain customary affirmative and negative covenants (including covenants related to construction completion, and limitations on the use of loan proceeds, transfers of land, equipment, and improvements), as well as customary events of default. Interest on our construction loan agreements is capitalized to the multi-family properties assets included in prepaid expenses and other assets on the condensed consolidated balance sheets while the related multi-family rental properties are being actively developed.

As of March 31, 2024 and December 31, 2023, $60.9 million and $44.9 million was outstanding under the construction loan agreements respectively, with borrowings that bore a weighted average interest rate of 7.5% and 7.4% during the three months ended March 31, 2024 and during the year ended December 31, 2023, respectively, and we were in compliance with all covenants thereunder.

Revolving Line of Credit

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exceeding $200.0 million. Our obligations under the Second A&R Credit Agreement are guaranteed by certain of our subsidiaries. The Second A&R Credit Agreement contains customary affirmative and negative covenants (including limitations on our ability to grant liens, incur additional debt, pay dividends, redeem our common stock, make certain investments and engage in certain merger, consolidation or asset sale transactions), as well as customary events of default. Borrowings under the Second A&R Credit Agreement are based on an adjusted term SOFR reference rate, which equals the greater of (i) 0.50% or (ii) the one-month quotation of the secured overnight financing rate administered by the Federal Reserve Bank of New York, plus 0.10%.

As of March 31, 2024 and December 31, 2023, no amounts were outstanding under the revolving line of credit, respectively, and we were in compliance with all covenants under the Second A&R Credit Agreement.

Mortgage Repurchase Facilities – Financial Services

Inspire is party to mortgage warehouse facilities with J.P. Morgan Chase Bank, N.A., Texas Capital Bank, and U.S. Bank National Association, which provide Inspire with uncommitted repurchase facilities of up to an aggregate of $450.0 million as of March 31, 2024, secured by the mortgage loans financed thereunder. The repurchase facilities have varying short term maturity dates through March 21, 2025. Borrowings under the mortgage repurchase facilities bear interest at variable interest rates per annum equal to SOFR plus an applicable margin, and bore a weighted average interest rate of 7.2% during the year ended March 31, 2024.

Amounts outstanding under the repurchase facilities are not guaranteed by us or any of our subsidiaries, and the agreements contain various affirmative and negative covenants applicable to Inspire that are customary for arrangements of this type. As of March 31, 2024 and December 31, 2023, we had $212.4 million and $239.3 million outstanding under the repurchase facilities, respectively, and were in compliance with all covenants thereunder.

10. Interest on Senior Notes and Revolving Line of Credit

Interest on our senior notes and revolving line of credit, if applicable, is capitalized to inventories while the related communities are being actively developed and until homes are completed. As our qualifying assets exceeded our outstanding debt during the three months ended March 31, 2024 and 2023, we capitalized all interest costs incurred on these facilities during these periods.

Our interest costs were as follows (in thousands):



	Three Months Ended March 31,
	2024		2023
Interest capitalized beginning of period	$	72,598	$	61,775
Interest capitalized during period		14,607		14,016
Less: capitalized interest in cost of sales		(12,033)		(9,807)
Interest capitalized end of period	$	75,172	$	65,984

11. Income Taxes

At the end of each interim period, we are required to estimate our annual effective tax rate for the fiscal year and to use that rate to provide for income taxes for the current year-to-date reporting period. Our 2024 estimated annual effective tax rate, before discrete items of 25.0%, is driven by our blended federal and state statutory rate of 24.7%, and certain permanent differences between GAAP and tax, including disallowed deductions for executive compensation offset by estimated federal energy home credits for current year home deliveries, which combined resulted in a net increase of 0.3%.

For the three months ended March 31, 2024, our estimated annual rate of 25.0% was benefitted by discrete items which had a net impact of decreasing our rate by 1.3%, including the impact of excess tax benefits for vested stock-based compensation.

For the three months ended March 31, 2024 and 2023, we recorded income tax expense of $20.0 million and $10.7 million, respectively.

12. Fair Value Disclosures

Fair value measurements are used for the Company’s mortgage loans held for sale, mortgage loans held for investment, mortgage servicing rights, interest rate lock commitments and other derivative instruments on a recurring basis. We also utilize fair value measurements on a non-recurring basis for inventories and intangible assets when events and circumstances indicate that the carrying value is not recoverable. The fair value hierarchy and its application to the Company’s assets and liabilities is as follows:

Level 1 – Quoted prices for identical instruments in active markets.

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Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are inactive; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets at the measurement date.

Mortgage loans held for sale – Fair value is based on quoted market prices for committed and uncommitted mortgage loans.

Derivative assets and liabilities – Derivative assets are associated with interest rate lock commitments and investor commitments on loans and may also be associated with forward mortgage-backed securities contracts. Derivative liabilities are associated with forward mortgage-backed securities contracts. Fair value is based on market prices for similar instruments.

Level 3 – Valuations derived from techniques where one or more significant inputs or significant value drivers are unobservable in active markets at the measurement date.

Mortgage servicing rights - The fair value of the mortgage servicing rights is calculated using third-party valuations. The key assumptions, which are generally unobservable inputs, used in the valuation of the mortgage servicing rights include mortgage prepayment rates, discount rates and cost to service.

Mortgage loans held for investment at fair value – The fair value of mortgage loans held for investment at fair value is calculated based on Level 3 analysis which incorporates information including the value of underlying collateral, from markets where there is little observable trading activity.

The following outlines the Company’s assets and liabilities measured at fair value on a recurring basis at March 31, 2024 and December 31, 2023, respectively (in thousands):


			March 31,		December 31,
	Balance Sheet Classification	Hierarchy	2024		2023

Mortgage loans held for sale	Mortgage loans held for sale	Level 2	$	217,702	$	251,852
Mortgage loans held for investment at fair value ⁽¹⁾	Prepaid expenses and other assets	Level 3	$	21,620	$	21,041
Derivative assets	Prepaid expenses and other assets	Level 2	$	3,790	$	1,618
Mortgage servicing rights ⁽²⁾	Prepaid expenses and other assets	Level 3	$	32,734	$	30,932
Derivative liabilities	Accrued expenses and other liabilities	Level 2	$	979	$	5,291

⁽¹⁾The unobservable inputs used in the valuation of the mortgage loans held for investment at fair value include, among other items, the value of underlying collateral, from markets where there is little observable trading activity.

⁽²⁾The unobservable inputs used in the valuation of the mortgage servicing rights include mortgage prepayment rates, discount rates and cost to service, which were 8.7%, 10.3%, and $0.072 per year per loan, respectively, as of March 31, 2024, and 8.6%, 10.3%, and $0.072 per year per loan, respectively, as of December 31, 2023. The high and low end of the range of unobservable inputs used in the valuation did not result in a significant change to the fair value measurement.

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The following table represents the reconciliation of the beginning and ending balance for the Level 3 recurring fair value measurements, with gains and losses from the changes in fair value reflected in financial services revenue on our condensed consolidated statements of operations (in thousands):


	Three Months Ended March 31,
Mortgage servicing rights		2024		2023
Beginning of period	$	30,932	$	24,164
Originations		1,234		1,045
Settlements		(562)		(151)
Changes in fair value		1,130		(1,157)
End of period	$	32,734	$	23,901

	Three Months Ended March 31,
Mortgage loans held-for-investment at fair value		2024		2023
Beginning of period	$	21,041	$	18,875
Transfers from loans held for sale		1,149		1,434
Settlements		(314)		—
Reduction in unpaid principal balance		(117)		(104)
Changes in fair value		(139)		(127)
End of period	$	21,620	$	20,078

For the financial assets and liabilities that the Company does not reflect at fair value, the following present both their respective carrying value and fair value at March 31, 2024 and December 31, 2023, respectively (in thousands).



		March 31, 2024				December 31, 2023

	Hierarchy	Carrying		Fair Value		Carrying		Fair Value
Cash and cash equivalents	Level 1	$	122,840	$	122,840	$	226,150	$	226,150
3.875% senior notes ⁽¹⁾⁽²⁾	Level 2	$	495,849	$	444,375	$	495,656	$	436,875
6.750% senior notes ⁽¹⁾⁽²⁾	Level 2	$	497,414	$	501,250	$	497,210	$	500,000
Revolving line of credit⁽³⁾	Level 2	$	—	$	—	$	—	$	—
Other financing obligations⁽³⁾⁽⁴⁾	Level 3	$	76,499	$	76,499	$	69,605	$	69,605
Mortgage repurchase facilities⁽³⁾	Level 2	$	212,447	$	212,447	$	239,298	$	239,298

⁽¹⁾Estimated fair value of the senior notes is based on recent trading activity in inactive markets.

⁽²⁾Carrying amounts include any associated unamortized deferred financing costs, premiums and discounts. As of March 31, 2024, these amounts totaled $4.2 million and $2.6 million for the 3.875% senior notes and 6.750% senior notes, respectively. As of December 31, 2023, these amounts totaled $4.3 million and $2.8 million for the 3.875% senior notes and 6.750% senior notes, respectively.

⁽³⁾Carrying amount approximates fair value due to short-term nature and/or interest rate terms.

⁽⁴⁾During the period ended March 31, 2024, other financing obligations included $15.6 million related to insurance premium notes and certain secured borrowings that generally bore interest rates ranging from 5.0% to 7.7%, and $60.9 million related to outstanding borrowings on the construction loan agreements that bore a weighted average interest rate of 7.5%. During the period ended December 31, 2023, other financing obligations included $24.7 million related to insurance premium notes and certain secured borrowings that generally bore interest rates ranging from 4.8% to 7.7%, and $44.9 million related to outstanding borrowings on the construction loan agreements that bore a weighted average interest rate of 7.4%.

Non-financial assets and liabilities include items such as inventory and property and equipment that are measured at fair value when acquired and as a result of impairments, if deemed necessary. No impairment charges were recorded in the three ended March 31, 2024 and 2023. When impairment charges are recognized, the estimated fair value of communities are determined through a discounted cash flow approach utilizing Level 3 inputs. Changes in our cash flow projections in future periods related to these communities may change our conclusions on the recoverability of inventory in the future.

13. Stock-Based Compensation

During the three months ended March 31, 2024 and 2023, we granted restricted stock units (which we refer to as “RSUs”) covering 0.2 million and 0.2 million shares of common stock, respectively, with a grant date fair value of $85.84 and $62.61 per share, respectively, that vest over a three year period.

During the three months ended March 31, 2024, we granted performance share units (which we refer to as “PSUs”) covering up to 0.3 million shares of common stock assuming maximum level of performance with a grant date fair value of $82.23 per share that are subject

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to both service and performance vesting conditions. During the three months ended March 31, 2023, we did not grant any PSUs. The quantity of shares that will ultimately vest and be issued upon settlement of the PSUs ranges from 0% to 250% of a targeted number of shares and will be determined based on an achievement of a three year adjusted pre-tax income performance goal. During the three months ended March 31, 2024 and 2023, we issued 0.2 million and 0.3 million shares of common stock, respectively, upon the vesting and settlement of PSUs that were granted in previous periods. Approximately 1.1 million shares will vest from 2025 to 2027 if the defined maximum performance targets are met, and no shares will vest if the defined minimum performance targets are not met.

A summary of our outstanding PSUs, assuming the current estimated level of performance achievement, and RSUs are as follows (in thousands, except years):


	March 31, 2024
Unvested units		1,248
Unrecognized compensation cost	$	45,077
Weighted-average years to recognize compensation cost		1.83

During the three months ended March 31, 2024 and 2023, we recognized stock-based compensation expense of $2.8 million and $5.4 million, respectively. Stock-based compensation expense is included in selling, general, and administrative expense on our condensed consolidated statements of operations. Stock-based compensation expense for PSUs is initially estimated based on target performance achievement and adjusted as appropriate throughout the performance period. Accordingly, future compensation cost associated with outstanding PSUs may increase or decrease based on the probability and extent of achievement with respect to the applicable performance measures.

14. Stockholders’ Equity

The Company’s authorized capital stock consists of 100.0 million shares of common stock, par value $0.01 per share, and 50.0 million shares of preferred stock, par value $0.01 per share. As of March 31, 2024 and December 31, 2023, there were 31.8 million and 31.8 million shares of common stock issued and outstanding, respectively, and no shares of preferred stock outstanding.

On May 4, 2022, the stockholders approved the adoption of the Century Communities, Inc. 2022 Omnibus Incentive Plan (which we refer to as the “2022 Incentive Plan”), which replaced the Century Communities, Inc. Amended and Restated 2017 Omnibus Incentive Plan (which we refer to as our “2017 Incentive Plan”). Under the 2022 Incentive Plan, 3.1 million shares of common stock are available for issuance to eligible participants, plus 51.2 thousand shares of our common stock that remained available for issuance under the 2017 Incentive Plan and any shares subject to awards outstanding under the 2017 Incentive Plan that are subsequently forfeited, cancelled, expire or otherwise terminate without the issuance of such shares. During the three months ended March 31, 2024 and 2023, we issued 0.3 million and 0.4 million shares of common stock, respectively, related to the vesting and settlement of RSUs and PSUs. As of March 31, 2024, approximately 2.2 million shares of common stock remained available for issuance under the 2022 Incentive Plan.

The following table sets forth cash dividends declared by our Board of Directors to holders of record of our common stock during the three months ended March 31, 2024 and 2023, respectively (in thousands, except per share information):



			Three Months Ended March 31, 2024
			Cash Dividends Declared and Paid
Declaration Date	Record Date	Paid Date	Per Share		Amount
February 7, 2024	February 28, 2024	March 13, 2024	$	0.26	$	8,264

			Three Months Ended March 31, 2023
			Cash Dividends Declared and Paid
Declaration Date	Record Date	Paid Date	Per Share		Amount
February 8, 2023	March 1, 2023	March 15, 2023	$	0.23	$	7,365

Under the 2022 Incentive Plan and the previous 2017 Incentive Plan, at the discretion of the Compensation Committee of the Board of Directors, RSUs and PSUs granted under the plan have the right to earn dividend equivalents, which entitles the holders of such RSUs and PSUs to additional RSUs and PSUs equal to the same dividend value per share as holders of common stock. Dividend equivalents are subject to the same vesting and other terms and conditions as the underlying RSUs and PSUs.

We are party to a Distribution Agreement with J.P. Morgan Securities LLC, BofA Securities, Inc., Wells Fargo Securities, LLC, and Fifth Third Securities, Inc. (which we refer to as the “Distribution Agreement”), as sales agents pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $100.0 million from time to time through any of the sales agents party thereto in “at-the-market” offerings, in accordance with the terms and conditions set forth in the Distribution Agreement. The

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Distribution Agreement will remain in full force and effect until terminated by either party pursuant to the terms of the agreement or such date that the maximum offering amount has been sold in accordance with the terms of the agreement. We did not sell or issue any shares of our common stock during the three months ended March 31, 2024 and 2023, and as of March 31, 2024, all $100.0 million remained available for sale.

We authorized a stock repurchase program in 2018, under which we may repurchase up to 4.5 million shares of our outstanding common stock. During the three months ended March 31, 2024, an aggregate of 186.9 thousand shares were repurchased for a total purchase price of approximately $16.1 million and a weighted average price of $86.16 per share. During the three months ended March 31, 2023, we did not repurchase any shares of common stock. The maximum number of shares available to be repurchased under the stock repurchase program as of March 31, 2024 was 1,043,123 shares.

During the three months ended March 31, 2024 and 2023, shares of common stock at a total cost of $10.4 million and $9.9 million, respectively, were netted and surrendered as payment for minimum statutory withholding obligations in connection with the vesting of outstanding stock-based compensation awards. Shares surrendered by the participants in accordance with the applicable award agreements and plan are deemed repurchased and retired by us but are not part of our publicly announced share repurchase programs.

15. Earnings Per Share

We use the treasury stock method to calculate earnings per share as our currently issued non-vested RSUs and PSUs do not have participating rights.

The following table sets forth the computation of basic and diluted EPS for the three months ended March 31, 2024 and 2023 (in thousands, except share and per share information):


	Three Months Ended March 31,
	2024		2023
Numerator
Net income	$	64,332	$	33,311
Denominator
Weighted average common shares outstanding - basic		31,808,959		31,914,414
Dilutive effect of stock-based compensation awards		429,849		202,668
Weighted average common shares outstanding - diluted		32,238,808		32,117,082
Earnings per share:
Basic	$	2.02	$	1.04
Diluted	$	2.00	$	1.04

Stock-based awards are excluded from the calculation of diluted EPS in the event they are subject to unsatisfied performance conditions or are antidilutive. We excluded 0.5 million and 0.5 million common stock unit equivalents from diluted earnings per share during the three months ended March 31, 2024 and 2023, respectively, related to the PSUs for which performance conditions remained unsatisfied.

16. Commitments and Contingencies

Letters of Credit and Performance Bonds

Legal Proceedings

We are subject to claims and lawsuits that arise primarily in the ordinary course of business, which consist primarily of construction claims. It is the opinion of our management that if the claims have merit, parties other than the Company would be, at least in part, liable for the claims, and the eventual outcome of these claims will not have a material adverse effect upon our consolidated financial condition, results of operations, or cash flows. When we believe that a loss is probable and estimable, we record a charge on our condensed consolidated statements of operations for our estimated loss.

Under various insurance policies, we have the ability to recoup costs in excess of applicable self-insured retentions. Estimates of such amounts are recorded in other assets on our condensed consolidated balance sheet when recovery is probable.

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We do not believe that the ultimate resolution of any claims and lawsuits will have a material adverse effect upon our consolidated financial position, results of operations, or cash flows.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Some of the statements included in this Quarterly Report on Form 10-Q (which we refer to as this “Form 10-Q”) constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, forecasts, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. These statements are only predictions. We caution that forward-looking statements are not guarantees. Actual results could differ materially from those expressed or implied in the forward-looking statements. Forward-looking statements are typically identified by the use of terms such as “may,” “will,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “predict,” “potential,” “outlook,” the negative of such terms and other comparable terminology and the use of future dates. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors.

The forward-looking statements included in this Form 10-Q reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement. Statements regarding the following subjects, among others, may be forward-looking and subject to risks and uncertainties including among others:

economic changes, either nationally or in the markets in which we operate, including increased interest rates and the resulting impact on the accessibility of mortgage loans to homebuyers, persistent inflation, and decreased employment levels;

shortages of or increased prices for labor, land or raw materials used in housing construction and resource shortages;

a downturn in the homebuilding industry, including a reduction in demand or a decline in real estate values or market conditions resulting in an adverse impact on our business, operating results and financial condition, including an impairment of our assets;

changes in assumptions used to make industry forecasts, population growth rates or trends affecting housing demand or prices;

volatility and uncertainty in the credit markets and broader financial markets and the impact on such markets and our ability to access them in the event of a threatened or actual U.S. government shutdown or sovereign default;

our future business operations, operating results and financial condition, and changes in our business and investment strategy;

availability and price of land to acquire, and our ability to acquire such land on favorable terms or at all;

availability, terms and deployment of capital;

availability or cost of mortgage financing or an increase in the number of foreclosures in the market;

delays in land development or home construction resulting from adverse weather conditions or other events outside our control;

delays in completion of projects, land development or home construction, or reduced consumer demand for housing resulting from significant weather conditions and natural disasters in the geographic areas where we operate;

the impact of construction defect, product liability, and/or home warranty claims, including the adequacy of accruals and the applicability and sufficiency of our insurance coverage;

changes in, or the failure or inability to comply with, governmental laws and regulations;

the timing of receipt of municipal, utility and other regulatory approvals and the opening of projects and construction and completion of our homes;

the impact and cost of compliance with evolving environmental, health and safety and other laws and regulations and third-party challenges to required permits and other approvals and potential legal liability in connection therewith;

the degree and nature of our competition;

unstable economic and political conditions as well as geopolitical conflicts, could adversely affect our supply chain by causing shortages or increases in costs for materials necessary to construct homes and/or increases to the price of gasoline and other fuels and cause higher interest rates, inflation or general economic uncertainty;

our leverage, debt service obligations and exposure to changes in interest rates and our ability to obtain additional or refinance our existing debt when needed or on favorable terms;

our ability to continue to fund and succeed in our mortgage lending business and the additional risks involved in that business;

availability of qualified personnel and contractors and our ability to obtain additional or retain existing key personnel and contractor relationships;

our ability to continue to pay dividends and make stock repurchases in the future; and

taxation and tax policy changes, tax rate changes, new tax laws, new or revised tax law interpretations or guidance.

Forward-looking statements are based on our beliefs, assumptions and expectations of future events, taking into account all information currently available to us. Forward-looking statements are not guarantees of future events or of our performance. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to us. Some of these events and factors are described above and in “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of

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Operations” and in “Part I, Item 1A. Risk Factors” in our Annual Report on Form 10-K, and other risks and uncertainties detailed in this report, including “Part II, Item 1A. Risk Factors,” and our other reports and filings with the SEC. If a change occurs, our business, financial condition, liquidity, cash flows and results of operations may vary materially from those expressed in or implied by our forward-looking statements. New risks and uncertainties arise over time, and it is not possible for us to predict the occurrence of those matters or the manner in which they may affect us. Except as required by law, we are not obligated to, and do not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Therefore, you should not rely on these forward-looking statements as of any date subsequent to the date of this Form 10-Q.

As used in this Form 10-Q, references to “we,” “us,” “our,” “Century” or the “Company” refer to Century Communities, Inc., a Delaware corporation, and, unless the context otherwise requires, its subsidiaries and affiliates.

The following discussion and analysis of our financial condition and results of operations is intended to help the reader understand our Company, business, operations and present business environment and is provided as a supplement to, and should be read in conjunction with, our condensed consolidated financial statements and the related notes to those statements included elsewhere in this Form 10-Q and our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. We use certain non-GAAP financial measures that we believe are important for purposes of comparison to prior periods. This information is also used by our management to measure the profitability of our ongoing operations and analyze our business performance and trends.

Business Overview

Century is engaged in the development, design, construction, marketing and sale of single-family attached and detached homes in 18 states. In many of our projects, in addition to building homes, we entitle and develop the underlying land. We build and sell homes under our Century Communities and Century Complete brands.

Our Century Communities brand has an emphasis on serving the entry-level homebuilding market but offers a wide range of buyer profiles including: entry-level, first and second time move-up, and lifestyle homebuyers, and provides our homebuyers with the ability to personalize their homes through certain option and upgrade opportunities. Our Century Complete brand targets entry-level homebuyers, primarily sells homes through retail studios and the internet, and generally provides no option or upgrade opportunities.

Our homebuilding operations are organized into the following five reportable segments: West, Mountain, Texas, Southeast, and Century Complete. Our indirect wholly-owned subsidiaries, Inspire Home Loans Inc., Parkway Title, LLC, IHL Home Insurance Agency, LLC, and IHL Escrow Inc., which provide mortgage, title, insurance, and escrow services, respectively, primarily to our homebuyers, have been identified as our Financial Services segment. Additionally, our wholly owned subsidiary, Century Living, LLC, is engaged in the development, construction and management of multi-family rental properties, currently all located in Colorado. Century Living, LLC is included in our Corporate segment.

While we offer homes that appeal to a broad range of entry-level, move-up, and lifestyle homebuyers, our offerings are heavily weighted towards providing affordable housing options in each of our homebuyer segments. Additionally, we prefer building move-in-ready homes over built-to-order homes, which we believe allows for a faster construction process, advantageous pricing with subcontractors, and shortened time period from home sale to home delivery, thus allowing our customers greater certainty on their financing and allowing us to more appropriately price the homes and deploy our capital. Of the 2,358 homes delivered during the first three months of 2024, approximately 94% of our deliveries were made to entry-level homebuyers that were below the Federal Housing Administration-insured mortgage limits and approximately 98% of homes delivered were built as move-in ready homes.

We generated solid financial results during the three months ended March 31, 2024 and are encouraged by recent housing market conditions demonstrating strong, underlying demand for affordable new homes. While uncertainty remains surrounding interest rates, we experienced strong demand during the first quarter of 2024, as net new home contracts (new home contracts net of cancellations) for the three months ended March 31, 2024 increased 41.7% as compared to the prior year period. We have continued to provide, when necessary, incentive offerings across our communities during the first quarter of 2024, including discounts on base home prices, lot premiums, and options and upgrades and financing incentives, including interest rate buydowns. During the three months ended March 31, 2024, cycle times have remained in the four- to five-month timeframe.

We anticipate the homebuilding markets in each of our operating segments will continue to be tied to both the macro-economic environment and the local economy, and we expect our operating strategy will continue to adapt to market changes, though we cannot provide any assurance that our strategies will remain consistent or continue to be successful. We believe future demand for our homes remains uncertain as future economic and market conditions remain uncertain, in particular with respect to inflation; the impact of potential future increases or decreases to the federal funds interest rate by the Federal Reserve; interest rates; availability and cost of mortgage loans to homebuyers; financial markets, credit and mortgage markets; the extent to which and how long government monetary directives, actions, and economic relief efforts will impact the U.S. economy; consumer confidence; wage growth; household formations; levels of new and existing homes for sale; prevailing home and rental prices; availability and cost of land, labor and construction materials; demographic trends; housing demand; and other factors, including those described elsewhere in this Form 10-Q. Specifically,

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changes in mortgage interest rates impact the costs of owning a home and affect the purchasing power of our customers and could impact homebuyer confidence. Changes in demand for our homes or cancellations due to mortgage interest rates or otherwise affect our operating results in future periods, including our net sales, home deliveries, gross margin, origination volume of and revenues from our Financial Services segment, and net income. As a result, our past performance may not be indicative of our future results.

Despite future macro-economic uncertainty, especially in relation to the interest rate environment, we believe we are well-positioned to benefit from the ongoing shortage of both new and resale homes available for purchase in our key markets and the favorable demographics that support the need for new affordable housing. We believe our operations are prepared to withstand volatility in future market conditions as a result of our product offerings which both span the home buying segment and focus on affordable price points, and our current and future inventories of attractive land positions. We have continued to focus on maintaining an appropriate balance of home and land inventories in relation to anticipated future demand, as well as prudent leverage, and, as a result, we believe we are well positioned to continue to execute on our strategy to optimize stockholder returns.

Results of Operations

During the three months ended March 31, 2024, we generated $84.3 million in income before income tax expense, as compared to $44.0 million in the prior year period, and net income of $64.3 million, or $2.00 per diluted share, as compared to $33.3 million, or $1.04 per diluted share, respectively, in the prior year period.

During the three months ended March 31, 2024, we generated total revenues of $948.5 million, a 25.4% increase as compared to the prior year period, driven primarily by home sales revenue. During the three months ended March 31, 2024, we delivered 2,358 homes with an average sales price of $391.2 thousand, as compared to 1,912 homes with an average sales price of $384.7 thousand in the prior year period. Net new contracts increased 41.7% to 2,866, as compared to 2,022 in the prior year period.

We ended the first quarter of 2024 with no amounts outstanding under our revolving line of credit, $122.8 million of cash and cash equivalents, $84.8 million of cash held in escrow, a homebuilding debt to capital ratio of 29.4%, and a net homebuilding debt to net capital ratio of 24.9%. During the three months ended March 31, 2024, we paid a quarterly cash dividend to our stockholders of $0.26 per share, which represents a 13% increase from the $0.23 per share quarterly dividend paid during the three months ended March 31, 2023. We have continued to strategically manage our lot pipeline, resulting in 75,089 lots owned and controlled at March 31, 2024.

During the three months ended March 31, 2024, we generated financial services revenue of $24.9 million, representing an increase of 57.2% as compared to the prior year period, driven by a 52.3% increase in the number of mortgages originated period over period, primarily due to our increased capture rate of 81% as of March 31, 2024 as compared to 66% for the prior year period, as well as a 41.2% increase in the number of loans sold to third parties period over period.

Our Century Living operations are engaged in construction on three multi-family for rent projects in Colorado, which commenced in 2022 and comprise over 900 total units. The first multi-family property consisting of over 200 units became available for leasing during 2023, and we anticipate the remaining projects will be available for leasing during 2024.

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The following table summarizes our results of operations for the three months ended March 31, 2024 and 2023:


(in thousands, except per share amounts)	Three Months Ended March 31,						Increase (Decrease)
	2024			2023			Amount			%
Consolidated Statements of Operations:
Revenues
Home sales revenues	$	922,402		$	735,600		$	186,802		25.4	%
Land sales and other revenues		1,216			1,535			(319)		(20.8)	%
Total homebuilding revenues		923,618			737,135			186,483		25.3	%
Financial services revenues		24,925			15,855			9,070		57.2	%
Total revenues		948,543			752,990			195,553		26.0	%
Homebuilding cost of revenues
Cost of home sales revenues		(725,570)			(601,385)			(124,185)		20.6	%
Cost of land sales and other revenues		(37)			—			(37)		NM
Total homebuilding cost of revenues		(725,607)			(601,385)			(124,222)		20.7	%
Financial services costs		(14,877)			(10,781)			(4,096)		38.0	%
Selling, general, and administrative		(114,109)			(98,313)			(15,796)		16.1	%
Other income (expense)		(9,630)			1,498			(11,128)		(742.9)	%
Income before income tax expense		84,320			44,009			40,311		91.6	%
Income tax expense		(19,988)			(10,698)			(9,290)		86.8	%
Net income	$	64,332		$	33,311		$	31,021		93.1	%
Earnings per share:
Basic	$	2.02		$	1.04		$	0.98		94.2	%
Diluted	$	2.00		$	1.04		$	0.96		92.3	%
Adjusted diluted earnings per share⁽¹⁾	$	2.22		$	1.04		$	1.18		113.5	%
Other Operating Information (dollars in thousands):
Number of homes delivered		2,358			1,912			446		23.3	%
Average sales price of homes delivered	$	391.2		$	384.7		$	6.5		1.7	%
Homebuilding gross margin percentage⁽²⁾		21.3	%		18.2	%		3.1	%	17.0	%
Adjusted homebuilding gross margin excluding interest, inventory impairment, and purchase price accounting for acquired work in process inventory ⁽¹⁾		22.8	%		19.6	%		3.2	%	16.3	%
Backlog at end of period, number of homes		1,590			1,920			(330)		(17.2)	%
Backlog at end of period, aggregate sales value	$	667,207		$	713,612		$	(46,405)		(6.5)	%
Average sales price of homes in backlog	$	419.6		$	371.7		$	47.9		12.9	%
Net new home contracts		2,866			2,022			844		41.7	%
Selling communities at period end		253			234			19		8.1	%
Average selling communities		255			223			32		14.3	%
Total owned and controlled lot inventory		75,089			51,614			23,475		45.5	%
Adjusted EBITDA⁽¹⁾	$	109,616		$	54,744		$	54,872		100.2	%
Adjusted income before income tax expense⁽¹⁾	$	93,623		$	44,009		$	49,614		112.7	%
Adjusted net income⁽¹⁾	$	71,430		$	33,311		$	38,119		114.4	%
Net homebuilding debt to net capital ⁽¹⁾		24.9	%		21.5	%		3.4	%	15.8	%

⁽¹⁾This is a non-GAAP financial measure and should not be used as a substitute for our operating results prepared in accordance with GAAP. See the reconciliations to the most comparable GAAP measure and other information under “Non-GAAP Financial Measures.” An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP.

⁽²⁾Homebuilding gross margin percentage is inclusive of impairment charges, if applicable. No impairment charges were recorded for the three months ended March 31, 2024 and 2023.

NM – Not Meaningful

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Results of Operations by Segment

(dollars in thousands)


	New Homes Delivered				Average Sales Price of Homes Delivered				Home Sales Revenues				Income before Income Tax Expense
	Three Months Ended March 31,				Three Months Ended March 31,				Three Months Ended March 31,				Three Months Ended March 31,
	2024		2023		2024		2023		2024		2023		2024		2023
West		284		203	$	606.5	$	634.9	$	172,254	$	128,894	$	26,707	$	7,973
Mountain		495		455		513.4		539.8		254,139		245,594		27,808		27,808
Texas		424		327		309.4		273.5		131,175		89,434		13,872		3,673
Southeast		379		198		426.1		439.0		161,501		86,929		20,796		11,966
Century Complete		776		729		262.0		253.4		203,333		184,749		21,101		13,950
Financial Services		—		—		—		—		—		—		10,048		5,074
Corporate		—		—		—		—		—		—		(36,012)		(26,435)
Total		2,358		1,912	$	391.2	$	384.7	$	922,402	$	735,600	$	84,320	$	44,009

West

During the three months ended March 31, 2024, our West segment generated income before income tax expense of $26.7 million, a 235.0% increase over the prior year period, which was driven by an increase in home sales revenue of $43.4 million. The revenue increase during the three months ended March 31, 2024 was primarily driven by a 39.9% increase in the number of homes delivered, partially offset by a 4.5% decrease in the average sales price per home. The increase in the number of homes delivered was primarily driven by an increase in the number of homes under construction. The average sales price decrease was driven by the mix of deliveries within individual communities.

Mountain

During the three months ended March 31, 2024, our Mountain segment generated income before income tax expense of $27.8 million, remaining consistent with the prior year period. Home sales revenue increased $8.5 million during the three months ended March 31, 2024, primarily driven by an 8.8% increase in the number of homes delivered, and partially offset by a 4.9% decrease in the average sales price per home. The increase in the number of homes delivered was primarily driven by an increase in the number of homes under construction. The average sales price decrease was driven by the mix of deliveries within individual communities. For the three months ended March 31, 2024, the decrease in the percentage of income before income tax expense to home sales revenue was primarily a result of the mix of margin profiles within individual communities.

Texas

During the three months ended March 31, 2024, our Texas segment generated income before income tax expense of $13.9 million, a 277.7% increase over the prior year period, which was driven by an increase in home sales revenue of $41.7 million. The revenue increase during the three months ended March 31, 2024 was primarily driven by both a 29.7% increase in the number of homes delivered and by a 13.1% increase in the average sales price per home. The increase in the number of homes delivered was primarily driven by an increase in the number of homes under construction, and the average sales price increase was driven by the mix of deliveries within individual communities.

Southeast

During the three months ended March 31, 2024, our Southeast segment generated income before income tax expense of $20.8 million, an 73.8% increase over the prior year period, which was driven by an increase in home sales revenue of $74.6 million. The revenue increase during the three months ended March 31, 2024 was primarily driven by a 91.4% increase in the number of homes delivered, partially offset by a 2.9% decrease in the average sales price per home. The increase in the number of homes delivered was primarily driven by an increase in the number of homes under construction, and the average sales price decrease was driven by the mix of deliveries within individual communities.

Century Complete

During the three months ended March 31, 2024, our Century Complete segment generated income before income tax expense of $21.1 million, a 51.3% increase over the prior year period, which was driven by an increase in home sales revenue of $18.6 million. The revenue increase during the three months ended March 31, 2024 was primarily driven by both a 6.4% increase in the number of homes delivered and by a 3.4% increase in the average sales price per home. The increase in the number of homes delivered was primarily

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driven by an increase in the number of homes under construction, and the average sales price increase was driven by the mix of deliveries within individual communities.

Financial Services

Our Financial Services segment originates mortgages primarily for our homebuyers, and as such, performance typically correlates to our number of homes delivered. Our Financial Services segment generated income before income tax of $10.0 million for the three months ended March 31, 2024, an increase of $5.0 million, or 98.0%, over the prior year period. This increase was driven by a $9.1 million increase in financial services revenue as compared to the prior year period. The increase in financial services revenue was primarily driven by a 52.3% increase in the number of mortgages originated period over period, primarily due to our increased capture rate of 81% as of March 31, 2024 as compared to 66% for the prior year period, as well as a 41.2% increase in the number of loans sold to third parties period over period.

The following table presents selected operational data for our Financial Services segment in relation to our loan origination activities (dollars in thousands):


	Three Months Ended March 31,
	2024			2023
Total originations:
Number of loans		1,506			989
Principal	$	540,164		$	343,081
Capture rate of Century homebuyers		81	%		66	%
Century Communities		86	%		72	%
Century Complete		69	%		56	%
Average FICO score		729			724
Century Communities		734			729
Century Complete		716			713

Loans sold to third parties:
Number of loans sold		1,608			1,139
Principal	$	568,392		$	389,810

Corporate

During the three months ended March 31, 2024, our Corporate segment generated a loss of $36.0 million as compared to a loss of $26.4 million during the same period in 2023. The increase in loss was primarily due to a $7.7 million impairment related to other investments during March 31, 2024.

Homebuilding Gross Margin

(dollars in thousands)

Homebuilding gross margin represents home sales revenues less cost of home sales revenues and inventory impairment, if applicable. Our homebuilding gross margin percentage, which represents homebuilding gross margin divided by home sales revenues, increased for the three months ended March 31, 2024 to 21.3% as compared to 18.2% during the same period in 2023. The increase was primarily driven by deliveries during the prior year period that carried both higher incentives and elevated construction costs due to homes commencing construction during high costs periods in 2022.

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In the following table, we calculate our homebuilding gross margin, as adjusted to exclude inventory impairment, if applicable, and interest in cost of home sales revenues.



	Three Months Ended March 31,
	2024		%		2023		%

Home sales revenues	$	922,402	100.0	%	$	735,600	100.0	%
Cost of home sales revenues		(725,570)	(78.7)	%		(601,385)	(81.8)	%
Inventory impairment		—	—	%		—	—	%
Homebuilding gross margin		196,832	21.3	%		134,215	18.2	%
Add: Inventory impairment		—	—	%		—	—	%
Add: Interest in cost of home sales revenues		12,033	1.3	%		9,807	1.3	%
Adjusted homebuilding gross margin excluding interest and inventory impairment ⁽¹⁾	$	208,865	22.6	%	$	144,022	19.6	%
Add: Purchase price accounting for acquired work in process inventory		1,581	0.2	%		—	—	%
Adjusted homebuilding gross margin excluding interest, inventory impairment and purchase price accounting for acquired work in process inventory ⁽¹⁾	$	210,446	22.8	%	$	144,022	19.6	%

⁽¹⁾This non-GAAP financial measure should not be used as a substitute for our operating results in accordance with GAAP. See the reconciliations to the most comparable GAAP measure and other information under “Non-GAAP Financial Measures.” An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP.

For the three ended March 31, 2024, our adjusted homebuilding gross margin percentage excluding interest in cost of home sales revenues, inventory impairment, and purchase price accounting for work in process inventory, was 22.8% as compared to 19.6% for the same period in 2023. We believe the above information is meaningful as it isolates the impact that indebtedness, inventory impairment (if applicable), and acquisitions (if applicable) have on our homebuilding gross margin and allows for comparability of our homebuilding gross margins to previous periods and our competitors.

Selling, General and Administrative Expense



(dollars in thousands)
	Three Months Ended March 31,						Change
	2024			2023			Amount		%
Selling, general and administrative	$	114,109		$	98,313		$	15,796	16.1	%
As a percentage of home sales revenue		12.4	%		13.4	%

Our selling, general and administrative expense increased $15.8 million for the three months ended March 31, 2024 as compared to the prior year period. This increase was primarily attributable to an increase in internal and external commission expense associated with the increase in home sales revenue and increased compensation and other costs due to increased active community count. These increases were partially offset by a decrease in stock compensation expense related to forfeitures during the period. As a percentage of home sales revenue, our selling, general and administrative expense decreased 100 basis points during the three months ended March 31, 2024, driven primarily by increased revenue on a partially fixed cost base.

Income Tax Expense

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For the three months ended March 31, 2024 and 2023, we recorded income tax expense of $20.0 million and $10.7 million, respectively.

Segment Assets

(dollars in thousands)


	March 31,		December 31			Increase (Decrease)
	2024		2023			Amount	Change
West	$	787,198	$	786,489	$	709	0.1	%
Mountain		1,050,830		1,051,052		(222)	(0.0)	%
Texas		617,785		577,129		40,656	7.0	%
Southeast		542,895		503,249		39,646	7.9	%
Century Complete		417,352		386,444		30,908	8.0	%
Financial Services		397,700		450,208		(52,508)	(11.7)	%
Corporate		297,817		384,791		(86,974)	(22.6)	%
Total assets	$	4,111,577	$	4,139,362	$	(27,785)	(0.7)	%

Total assets remained consistent at $4.1 billion as of March 31, 2024 and December 31, 2023.

Lots owned and controlled


	March 31, 2024			December 31, 2023			% Change
	Owned	Controlled	Total	Owned	Controlled	Total	Owned		Controlled		Total

West	4,397	3,230	7,627	4,036	3,259	7,295	8.9	%	(0.9)	%	4.6	%
Mountain	8,475	5,602	14,077	8,615	5,025	13,640	(1.6)	%	11.5	%	3.2	%
Texas	9,422	11,183	20,605	8,647	11,027	19,674	9.0	%	1.4	%	4.7	%
Southeast	5,461	10,370	15,831	5,486	10,941	16,427	(0.5)	%	(5.2)	%	(3.6)	%
Century Complete	3,955	12,994	16,949	3,839	12,845	16,684	3.0	%	1.2	%	1.6	%
Total	31,710	43,379	75,089	30,623	43,097	73,720	3.5	%	0.7	%	1.9	%

Of our total lots owned and controlled as of March 31, 2024, 42.2% were owned and 57.8% were controlled, as compared to 41.5% owned and 58.5% controlled as of December 31, 2023.

Other Homebuilding Operating Data

Net new home contracts


	Three Months Ended
	March 31,		Increase (Decrease)
	2024	2023	Amount	% Change
West	440	343	97	28.3	%
Mountain	611	333	278	83.5	%
Texas	514	475	39	8.2	%
Southeast	450	242	208	86.0	%
Century Complete	851	629	222	35.3	%
Total	2,866	2,022	844	41.7	%

Net new home contracts (new home contracts net of cancellations) for the three months ended March 31, 2024 increased by 844 homes, or 41.7%, to 2,866 as compared to 2,022 for the same period in 2023, primarily due to more homes available for sale, as well as favorable market conditions.

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Monthly absorption rate

Our overall monthly “absorption rate” (the rate at which home orders are contracted, net of cancellations) for the three months ended March 31, 2024 and 2023 by segment are included in the tables below:


	Three Months Ended March 31,		Increase (Decrease)
	2024	2023	Amount	% Change
West	5.2	4.4	0.8	18.2	%
Mountain	4.4	2.8	1.6	57.1	%
Texas	4.2	4.5	(0.3)	(6.7)	%
Southeast	5.0	2.9	2.1	72.4	%
Century Complete	2.6	2.0	0.6	30.0	%
Total	3.8	2.9	0.9	31.0	%

During the three months ended March 31, 2024, our absorption rate increased by 31.0% to 3.8 per month as compared to the same period in 2023, driven by strong demand for new homes during the current period as homebuyers adjust to the higher interest rate environment.

Selling communities at period end



	As of March 31,		Increase/(Decrease)
	2024	2023	Amount	% Change
West	28	26	2	7.7	%
Mountain	46	40	6	15.0	%
Texas	41	35	6	17.1	%
Southeast	30	28	2	7.1	%
Century Complete	108	105	3	2.9	%
Total	253	234	19	8.1	%

Our selling communities increased by 19 communities to 253 communities at March 31, 2024 as compared to 234 at March 31, 2023. This 8.1% increase was a result of an increased land pipeline that resulted in new community openings in excess of community closeouts during the first quarter of 2024.

Backlog

(dollars in thousands)



	As of March 31,
	2024					2023					% Change

	Homes	Dollar Value		Average Sales Price		Homes	Dollar Value		Average Sales Price		Homes		Dollar Value		Average Sales Price

West	262	$	176,732	$	674.5	220	$	133,249	$	605.7	19.1	%	32.6	%	11.4	%
Mountain	279		161,477		578.8	319		152,521		478.1	(12.5)	%	5.9	%	21.1	%
Texas	258		78,396		303.9	303		95,464		315.1	(14.9)	%	(17.9)	%	(3.6)	%
Southeast	214		99,448		464.7	249		110,864		445.2	(14.1)	%	(10.3)	%	4.4	%
Century Complete	577		151,154		262.0	829		221,514		267.2	(30.4)	%	(31.8)	%	(1.9)	%
Total / Weighted Average	1,590	$	667,207	$	419.6	1,920	$	713,612	$	371.7	(17.2)	%	(6.5)	%	12.9	%

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Backlog reflects the number of homes, net of cancellations, for which we have entered into a sales contract with a customer but for which we have not yet delivered the home. At March 31, 2024, we had 1,590 homes in backlog with a total value of $667.2 million, which represents decreases of 17.2% and 6.5%, respectively, as compared to 1,920 homes in backlog with a total value of $713.6 million at December 31, 2023. The decrease in backlog dollar value is primarily attributable to the decrease in backlog units.

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Supplemental Guarantor Information

Our 6.750% senior notes due 2027 (which we collectively refer to as our “2027 Notes”) and our 3.875% senior notes due 2029 (which we collectively refer to as our “2029 Notes” and together with the 2027 Notes, the “Senior Notes”) are our unsecured senior obligations and are fully and unconditionally guaranteed on an unsecured basis, jointly and severally, by substantially all of our direct and indirect wholly-owned operating subsidiaries (which we refer to collectively as “Guarantors”). Our subsidiaries associated with our Financial Services operations (referred to as “Non-Guarantors”) do not guarantee the Senior Notes. The guarantees are senior unsecured obligations of the Guarantors that rank equal with all existing and future senior debt of the Guarantors and senior to all subordinated debt of the Guarantors. The guarantees are effectively subordinated to any secured debt of the Guarantors. As of March 31, 2024, Century Communities, Inc. had outstanding $1.0 billion in total principal amount of Senior Notes.

Each of the indentures governing our Senior Notes provides that the guarantees of a Guarantor will be automatically and unconditionally released and discharged: (1) upon any sale, transfer, exchange or other disposition (by merger, consolidation or otherwise) of all of the equity interests of such Guarantor after which the applicable Guarantor is no longer a “Restricted Subsidiary” (as defined in the respective indentures), which sale, transfer, exchange or other disposition does not constitute an “Asset Sale” (as defined in the respective indentures) or is made in compliance with applicable provisions of the applicable indenture; (2) upon any sale, transfer, exchange or other disposition (by merger, consolidation or otherwise) of all of the assets of such Guarantor, which sale, transfer, exchange or other disposition does not constitute an Asset Sale or is made in compliance with applicable provisions of the applicable indenture; provided, that after such sale, transfer, exchange or other disposition, such Guarantor is an “Immaterial Subsidiary” (as defined in the respective indentures); (3) unless a default has occurred and is continuing, upon the release or discharge of such Guarantor from its guarantee of any indebtedness for borrowed money of the Company and the Guarantors so long as such Guarantor would not then otherwise be required to provide a guarantee pursuant to the applicable indenture; provided that if such Guarantor has incurred any indebtedness in reliance on its status as a Guarantor in compliance with applicable provisions of the applicable Indenture, such Guarantor’s obligations under such indebtedness, as the case may be, so incurred are satisfied in full and discharged or are otherwise permitted to be incurred by a Restricted Subsidiary (other than a Guarantor) in compliance with applicable provisions of the applicable Indenture; (4) upon the designation of such Guarantor as an “Unrestricted Subsidiary” (as defined in the respective Indentures), in accordance with the applicable indenture; (5) if the Company exercises its legal defeasance option or covenant defeasance option under the applicable indenture or if the obligations of the Company and the Guarantors are discharged in compliance with applicable provisions of the applicable indenture, upon such exercise or discharge; or (6) in connection with the dissolution of such Guarantor under applicable law in accordance with the applicable indenture.

If a guarantor were to become a debtor in a case under the US Bankruptcy Code, a court may decline to enforce its guarantee of the Senior Notes. This may occur when, among other factors, it is found that the guarantor originally received less than fair consideration for the guarantee and the guarantor would be rendered insolvent by enforcement of the guarantee. On the basis of historical financial information, operating history and other factors, we believe that each of the guarantors, after giving effect to the issuance of its guarantee of the Senior Notes when the guarantee was issued, was not insolvent and did not and has not incurred debts beyond its ability to pay such debts as they mature. The Company cannot predict, however, what standard a court would apply in making these determinations or that a court would agree with our conclusions in this regard.

Only the 2027 Notes and the related guarantees are registered securities under the Securities Act of 1933, as amended (the “Securities Act”). The offer and sale of the 2029 Notes and the related guarantees were not and will not be registered under the Securities Act or the securities laws of any other jurisdiction and instead were issued in reliance upon an exemption from such registration. Unless they are subsequently registered under the Securities Act, neither the 2029 Notes nor the related guarantees may be offered and sold only in transactions that are exempt from the registration requirements under the Securities Act and the applicable securities laws of any other jurisdiction.

The Guarantors’ condensed supplemental financial information is presented in this report as if the Senior Note guarantees existed during the periods presented pursuant to applicable SEC rules and guidance. If any Guarantors are released from the guarantees in future periods, the changes are reflected prospectively. We have determined that separate, full financial statements of the Guarantors would not be material to investors, and accordingly, supplemental financial information is presented below.

The following summarized financial information is presented for Century Communities, Inc. and the Guarantor Subsidiaries on a combined basis after eliminating intercompany transactions and balances among Century Communities, Inc. and the Guarantor Subsidiaries, as well as their investment in, and equity in earnings from Non-Guarantor Subsidiaries.

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Century Communities, Inc. and Guarantor Subsidiaries


Summarized Balance Sheet Data (in thousands)	March 31, 2024		December 31, 2023

Assets
Cash and cash equivalents	$	21,547	$	104,900
Cash held in escrow		84,776		101,845
Accounts receivable		57,935		67,480
Due from non-guarantors		—		17,982
Inventories		3,107,133		3,016,641
Prepaid expenses and other assets		318,441		282,056
Property and equipment, net		74,363		68,839
Deferred tax assets, net		17,601		16,998
Goodwill		32,082		30,395
Total assets	$	3,713,878	$	3,707,136
Liabilities and stockholders’ equity
Liabilities:
Accounts payable	$	133,963	$	145,231
Accrued expenses and other liabilities		237,579		259,912
Due to non-guarantors		10,029		—
Notes payable		1,069,762		1,062,471
Revolving line of credit		—		—
Total liabilities		1,451,333		1,467,614
Stockholders’ equity:		2,262,545		2,239,522
Total liabilities and stockholders’ equity	$	3,713,878	$	3,707,136


Summarized Statements of Operations Data (in thousands)	Year Ended		Year Ended
	March 31, 2024		December 31, 2023

Total homebuilding revenues	$	923,618	$	3,611,962
Total homebuilding cost of revenues		(725,607)		(2,840,583)
Selling, general and administrative		(114,109)		(447,311)
Inventory impairment		—		(1,877)
Other income (expense)		(11,594)		(6,547)
Income before income tax expense		72,308		315,644
Income tax expense		(17,141)		(82,419)
Net income	$	55,167	$	233,225

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Critical Accounting Policies

Critical accounting estimates are those that we believe are both significant and require us to make difficult, subjective or complex judgments, often because we need to estimate the effect of inherently uncertain matters. We base our estimates and judgments on historical experiences and various other factors that we believe to be appropriate under the circumstances. Actual results may differ from these estimates, and the estimates included in our financial statements might be impacted if we used different assumptions or conditions. A summary of our critical accounting policies is included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 5, 2024, in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies.”

Liquidity and Capital Resources

Overview

Our liquidity, consisting of our cash and cash equivalents and cash held in escrow and revolving line of credit availability, was $1.0 billion as of March 31, 2024 and $1.1 billion as of December 31, 2023.

Our principal uses of capital for the three months ended March 31, 2024 were our land purchases, land development, home construction, the acquisition of Landmark Homes, share repurchases, dividends, and the payment of routine liabilities.

Cash flows for each of our communities depend on the stage in the development cycle and can differ substantially from reported earnings. Early stages of development or expansion require significant cash outlays for land acquisitions, entitlements and other approvals, and construction of model homes, roads, utilities, general landscaping and other amenities. Because these costs are a component of our inventory and not recognized in our consolidated statements of operations until a home closes, we incur significant cash outlays prior to our recognition of earnings. In the later stages of community development, cash inflows may significantly exceed earnings reported for financial statement purposes, as the cash outflow associated with home and land construction was previously incurred. From a liquidity standpoint, we continue to acquire and develop lots in our markets when they meet our current investment criteria.

Short-term Liquidity and Capital Resources

We use funds generated by operations, available borrowings under our revolving line of credit facility, and proceeds from issuances of debt or equity, including our at-the-market facility, to fund our short term working capital obligations and fund our purchases of land, as well as land development, home construction activities, and other cash needs.

Our Financial Services operations use funds generated from operations and availability under our mortgage repurchase facilities to finance its operations, including originations of mortgage loans to our homebuyers.

Our Century Living operations use excess cash from our operations, as well as project specific secured financing under construction loan agreements to fund development of multi-family projects.

We believe that we will be able to fund our current liquidity needs for at least the next twelve months with our cash on hand, cash generated from operations, and cash expected to be available from our revolving line of credit or through accessing debt or equity capital, as needed or appropriate, although no assurance can be provided that such additional debt or equity capital will be available or on acceptable terms based on the macro-economy and market conditions at the time. In a higher interest rate environment, we may incur additional interest expense on borrowings that bear floating interest rates, such as our revolving line of credit. We believe we are well positioned from a cash and liquidity standpoint to operate in an uncertain environment, and to pursue other ways to properly deploy capital to enhance returns, which may include taking advantage of strategic opportunities as they arise.

Long-term Liquidity and Capital Resources

Beyond the next twelve months, we believe that our principal uses of capital will be land and inventory purchases and other expenditures, as well as principal and interest payments on our long-term debt obligations. We believe that we will be able to fund our long-term liquidity needs with cash generated from operations and cash expected to be available from our revolving line of credit or through accessing debt or equity capital, as needed or appropriate, although no assurance can be provided that such additional debt or equity capital will be available, or on favorable terms, especially in light of rising interest rates. In a higher interest rate environment, we may incur additional interest expense on borrowings that bear floating interest rates, such as under our revolving line of credit, repurchase facilities, and construction loan agreements. To the extent these sources of capital are insufficient to meet our needs, we may also conduct additional public or private offerings of our securities, refinance debt, or dispose of certain assets to fund our operating activities and capital needs.

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Material Cash Requirements

In the normal course of business, we enter into contracts and commitments that obligate us to make payments in the future. These obligations impact our short-term and long-term liquidity and capital resource needs. For the three months ended March 31, 2024, there were no material changes to the contractual obligations we previously described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 that was filed with the SEC on February 5, 2024.

In the ordinary course of business, we enter into land purchase contracts in order to procure lots for the construction of our homes. We are subject to customary obligations associated with entering into contracts for the purchase of land and improved lots. Purchase and option contracts for the purchase of land enable us to defer acquiring portions of properties owned by third parties until we have determined whether to exercise our option, which may serve to reduce our financial risks associated with long-term land holdings. These purchase contracts typically require a cash deposit, and the purchase of properties under these contracts is generally contingent upon satisfaction of certain requirements, including obtaining applicable property and development entitlements. We also utilize option contracts with land sellers and others as a method of acquiring land in staged takedowns, to help us manage the financial and market risk associated with land holdings, and to reduce the use of funds from our corporate financing sources. Option contracts generally require payment by us of a non-refundable deposit for the right to acquire lots over a specified period of time at pre-determined prices. Our obligations with respect to purchase contracts and option contracts are generally limited to the forfeiture of the related non-refundable cash deposits.

As of March 31, 2024, we had outstanding purchase contracts and option contracts for 43,379 lots totaling approximately $2.2 billion and we had $64.1 million of deposits for land contracts, of which $37.4 million were non-refundable cash deposits pertaining to land contracts. For contracts for which cash deposits were non-refundable, and subject to the terms of the outstanding contracts continuing to meet our investment criteria, we currently anticipate performing on the majority of our purchase and option contracts during the next 24 months. Our performance, including the timing and amount of purchase, if any, under these outstanding purchase and option contracts is subject to change and dependent on future market conditions. Our utilization of land option contracts is dependent on, among other things, the availability of land sellers willing to enter into option takedown arrangements, the availability of capital to financial intermediaries to finance the development of optioned lots, general housing market conditions, and local market dynamics. Options may be more difficult to procure from land sellers in strong housing markets and are more prevalent in certain geographic regions.

Outstanding Debt Obligations and Debt Service Requirements

One of our principal liquidity needs is the payment of principal and interest on our outstanding indebtedness. Our outstanding indebtedness is described in detail in Note 9 – Debt in the Notes to the Condensed Consolidated Financial Statements. We are required to meet certain covenants, and as of March 31, 2024, we were in compliance with all such covenants and requirements under the agreements governing our revolving line of credit, mortgage repurchase facilities, and construction loan agreements. See Note 9 – Debt in the Notes to the Condensed Consolidated Financial Statements for further detail.

Our outstanding debt obligations included the following as of March 31, 2024 and December 31, 2023 (in thousands):



	March 31,		December 31,
	2024		2023
3.875% senior notes, due August 2029⁽¹⁾	$	495,849	$	495,656
6.750% senior notes, due June 2027⁽¹⁾		497,414		497,210
Other financing obligations⁽²⁾		76,499		69,605
Notes payable		1,069,762		1,062,471
Revolving line of credit		—		—
Mortgage repurchase facilities		212,447		239,298
Total debt	$	1,282,209	$	1,301,769

⁽¹⁾The carrying value of the senior notes reflects the impact of premiums, discounts, and issuance costs that are amortized to interest cost over the respective terms of the senior notes.

⁽²⁾As of March 31, 2024, other financing obligations included $15.6 million related to insurance premium notes and certain secured borrowings, as well as $60.9 million outstanding under construction loan agreements, as described below. As of December 31, 2023, other financing obligations included $24.7 million related to insurance premium notes and certain secured borrowings, as well as $44.9 million outstanding under construction loan agreements.

We may from time to time seek to refinance or increase our outstanding debt or retire or purchase our outstanding debt through cash purchases and/or exchanges for equity securities, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may or may not be material during any particular reporting period.

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Letters of Credit and Performance Bonds

In the normal course of business, we post letters of credit and performance and other bonds primarily related to our land development performance obligations with local municipalities. As of March 31, 2024 and December 31, 2023, we had $509.0 million and $510.5 million, respectively, in letters of credit and performance and other bonds issued and outstanding. Although significant development and construction activities have been completed related to the improvements at these sites, the letters of credit and performance and other bonds are not generally fully released until all development and construction activities are completed.

Construction Loan Agreements

As of March 31, 2024, $60.9 million was outstanding under the construction loan agreements, with borrowings that bore a weighted average interest rate of 7.5% during the three months ended March 31, 2024, and we were in compliance with all covenants thereunder.

Revolving Line of Credit

In 2021, we entered into a Second Amended and Restated Credit Agreement (which we refer to as the “Second A&R Credit Agreement”) with Texas Capital Bank, National Association, as Administrative Agent and L/C Issuer, and the lenders party thereto. The Second A&R Credit Agreement, which amended and restated our prior Amended and Restated Credit Agreement, provides us with a senior unsecured revolving line of credit (which we refer to as the “revolving line of credit”) of up to $800.0 million, and unless terminated earlier, will mature on April 30, 2026. The revolving line of credit includes a $250.0 million sublimit for standby letters of credit. Under the terms of the Second A&R Credit Agreement, we are entitled to request an increase in the size of the revolving line of credit by an amount not exceeding $200.0 million. Our obligations under the Second A&R Credit Agreement are guaranteed by certain of our subsidiaries. The Second A&R Credit Agreement contains customary affirmative and negative covenants (including limitations on our ability to grant liens, incur additional debt, pay dividends, redeem our common stock, make certain investments and engage in certain merger, consolidation or asset sale transactions), as well as customary events of default. Borrowings under the Second A&R Credit Agreement are based on an adjusted term SOFR reference rate, which equals the greater of (i) 0.50% or (ii) the one-month quotation of the secured overnight financing rate administered by the Federal Reserve Bank of New York, plus 0.10%.

As of March 31, 2024 and December 31, 2023, no amounts were outstanding under our revolving line of credit and were in compliance with all covenants under the Second A&R Credit Agreement.

Mortgage Repurchase Facilities – Financial Services

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At-the-Market Offerings

We are party to a Distribution Agreement with J.P. Morgan Securities LLC, BofA Securities, Inc., Wells Fargo Securities, LLC and Fifth Third Securities, Inc. (which we refer to as the “Distribution Agreement”), as sales agents pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $100.0 million from time to time through any of the sales agents party thereto in “at-the-market” offerings, in accordance with the terms and conditions set forth in the Distribution Agreement. The Distribution Agreement will remain in full force and effect until terminated by either party pursuant to the terms of the agreement or such date that the maximum offering amount has been sold in accordance with the terms of the agreement. We did not sell or issue any shares of our common stock during the three months ended March 31, 2024 and 2023, respectively, and as of March 31, 2024, all $100.0 million remained available for sale.

Stock Repurchase Program

Our Board of Directors authorized a stock repurchase program in 2018, under which we may repurchase up to 4.5 million shares of our outstanding common stock. The shares may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws. The actual manner, timing, amount and value of repurchases under the stock repurchase program will be determined by management at its discretion and will depend on a number of factors, including the market price of our common stock, trading volume, other capital management objectives and opportunities, applicable legal requirements, applicable tax effects including the 1% excise tax instituted under the Inflation Reduction Act of 2022, and general market and economic conditions.

We intend to finance any stock repurchases through available cash and our revolving line of credit. Repurchases also may be made under a trading plan under Rule 10b5-1 under the Securities Exchange Act of 1934, which would permit shares to be repurchased when we otherwise may be precluded from doing so because of self-imposed trading blackout periods or other regulatory restrictions. The stock repurchase program has no expiration date and may be extended, suspended or discontinued by our Board of Directors at any time without notice at our discretion. All shares of common stock repurchased under the program will be cancelled and returned to the status of authorized but unissued shares of common stock.

During the three months ended March 31, 2024, an aggregate of 186.9 thousand shares were repurchased for a total purchase price of approximately $16.1 million and a weighted average price of $86.16 per share. During the three months ended March 31, 2023, we did not repurchase any shares of common stock. The maximum number of shares available to be repurchased under the stock repurchase program as of March 31, 2024 was 1,043,123 shares.

Dividends



			Three Months Ended March 31, 2024
			Cash Dividends Declared and Paid
Declaration Date	Record Date	Paid Date	Per Share		Amount
February 7, 2024	February 28, 2024	March 13, 2024	$	0.26	$	8,264

			Three Months Ended March 31, 2023
			Cash Dividends Declared and Paid
Declaration Date	Record Date	Paid Date	Per Share		Amount
February 8, 2023	March 1, 2023	March 15, 2023	$	0.23	$	7,365

The declaration and payment of future cash dividends on our common stock, whether at current levels or at all, are at the discretion of our Board of Directors and depend upon, among other things, our expected future earnings, cash flows, capital requirements, access to external financing, debt structure and any adjustments thereto, operational and financial investment strategy and general financial condition, as well as general business conditions.

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Cash Flows— Three Months Ended March 31, 2024 Compared to the Three Months Ended March 31, 2023

For the three months ended March 31, 2024 and 2023, the comparison of cash flows is as follows:

Our primary sources of cash flows from operations are from the sale of single-family attached and detached homes and mortgages. Our primary uses of cash flows from operations are the acquisition of land and expenditures associated with the construction of our single-family attached and detached homes and the origination of mortgages held for sale. Net cash provided by operating activities was $21.6 million during the three months ended March 31, 2024 as compared to $191.3 million during the prior year period. This decrease is primarily a result of increased expenditures related to land acquisition and expenditures associated with the construction of homes during the three months ended March 31, 2024 as compared to the three months ended March 31, 2023. This reduction was primarily offset by a $31.0 million increase in net income.

Net cash used in investing activities increased to $64.6 million during the three months ended March 31, 2024, compared to $20.9 million used during the prior year period. This increase was primarily related to (1) $9.7 million increase in expenditures related to the development, construction, and management of multi-family rental properties by our wholly owned subsidiary, Century Living; and (2) $32.7 million in expenditures related to a business combination during the three months ended March 31, 2024.

Net cash used in financing activities was $54.7 million during the three months ended March 31, 2024, compared $58.3 million during the prior year period. This decrease was primarily attributable to (1) a $21.0 million decrease in net payments on our mortgage repurchase facilities and (2) an $8.8 million increase in borrowings under construction loan agreements, partially offset by (1) $16.1 million in repurchases of our common stock during the three months ended March 31, 2024 as compared to no repurchases of our common stock during the prior year period; and (2) an $8.7 million net increase in payments for insurance premium notes.

As of March 31, 2024, our cash and cash equivalents and restricted cash balance was $144.3 million, as compared to $242.0 million as of December 31, 2023.

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Non-GAAP Financial Measures

In this Form 10-Q, we use certain non-GAAP financial measures, including EBITDA, adjusted EBITDA, net homebuilding debt to net capital, adjusted net income and adjusted diluted earnings per share. These non-GAAP financial measures are presented to provide investors additional information to facilitate the comparison of our past and present operations. We believe these non-GAAP financial measures provide useful information to investors because they are used to evaluate our performance on a comparable year-over-year basis. These non-GAAP financial measures are not in accordance with, or an alternative for, GAAP measures and may be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP financial measures are not based on any comprehensive or standard set of accounting rules or principles. Accordingly, the calculation of our non-GAAP financial measures may differ from the definitions of other companies using the same or similar names limiting, to some extent, the usefulness of such measures for comparison purposes. Non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with our financial results as determined in accordance with GAAP. These measures should only be used to evaluate our financial results in conjunction with the corresponding GAAP measures. Accordingly, we qualify our use of non-GAAP financial information in a statement when non-GAAP financial information is presented.

EBITDA and Adjusted EBITDA

The following table presents EBITDA and adjusted EBITDA for the three months ended March 31, 2024 and 2023. EBITDA and adjusted EBITDA are non-GAAP financial measures we use as a supplemental measure in evaluating operating performance. We define EBITDA as net income before (i) income tax expense, (ii) interest in cost of home sales revenues, (iii) other interest expense (income), and (iv) depreciation and amortization expense. We define adjusted EBITDA as EBITDA before loss on debt extinguishment (if applicable), inventory impairment (if applicable), purchase price accounting for acquired work in process inventory (if applicable), and impairment on other investments (if applicable). We believe EBITDA and adjusted EBITDA provide an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization, and items considered to be non-recurring. Accordingly, our management believes that these measurements are useful for comparing general operating performance from period to period. Neither EBITDA or adjusted EBITDA should be considered in addition to, and not as a substitute for, consolidated net income in accordance with GAAP as a measure of performance. Our presentation of adjusted EBITDA should not be construed as an indication that our future results will be unaffected by unusual or non-recurring items. Each of our EBITDA and adjusted EBITDA is limited as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP.

(dollars in thousands)


	Three Months Ended March 31,
	2024		2023		% Change
Net income	$	64,332	$	33,311		93.1	%
Income tax expense		19,988		10,698		86.8	%
Interest in cost of home sales revenues		12,033		9,807		22.7	%
Interest income		(1,515)		(2,364)		(35.9)	%
Depreciation and amortization expense		5,475		3,292		66.3	%
EBITDA		100,313		54,744		83.2	%
Inventory impairment		—		—		NM
Impairment on other investment		7,722		—		NM
Purchase price accounting for acquired work in process inventory		1,581		—		NM
Adjusted EBITDA	$	109,616	$	54,744		100.2	%

NM – Not Meaningful

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Net Homebuilding Debt to Net Capital

The following table presents our ratio of net homebuilding debt to net capital, which is a non-GAAP financial measure. We calculate this by dividing net homebuilding debt (homebuilding debt less cash and cash equivalents, and cash held in escrow) by net capital (net homebuilding debt plus total stockholders’ equity). Homebuilding debt is our total debt minus our outstanding borrowings under our construction loan agreements and our repurchase facilities. The most directly comparable GAAP measure is the ratio of debt to total capital. We believe the ratio of net homebuilding debt to net capital is a relevant and useful financial measure to investors in understanding the leverage employed in our operations and as an indicator of our ability to obtain external financing.

(dollars in thousands)


	March 31,		December 31,
	2024		2023
Notes payable	$	1,069,762	$	1,062,471
Revolving line of credit		—		—
Construction loan agreements		(60,867)		(44,895)
Total homebuilding debt		1,008,895		1,017,576
Total stockholders' equity		2,419,276		2,386,936
Total capital	$	3,428,171	$	3,404,512
Homebuilding debt to capital		29.4%		29.9%

Total homebuilding debt	$	1,008,895	$	1,017,576
Cash and cash equivalents		(122,840)		(226,150)
Cash held in escrow		(84,776)		(101,845)
Net homebuilding debt		801,279		689,581
Total stockholders' equity		2,419,276		2,386,936
Net capital	$	3,220,555	$	3,076,517

Net homebuilding debt to net capital		24.9%		22.4%

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Adjusted Net Income and Adjusted Diluted Earnings per Share

Adjusted net income and adjusted diluted earnings per share (which we refer to as “Adjusted EPS”) are non-GAAP financial measures that we believe are useful to management, investors and other users of our financial information in evaluating our operating results and understanding our operating trends without the effect of certain non-recurring items. We believe excluding certain non-recurring items provides more comparable assessment of our financial results from period to period. We define adjusted net income as consolidated net income before (i) income tax expense, (ii) inventory impairment, if applicable (iii) restructuring costs, if applicable, (iv) loss on debt extinguishment, if applicable, (v) purchase price accounting for acquired work in process inventory, if applicable, and (vi) impairment on other investments, if applicable, less adjusted income tax expense, calculated using our estimated annual effective tax rate after discrete items for the applicable period. Adjusted EPS is calculated by dividing adjusted net income by weighted average common shares – diluted.

(in thousands, except share and per share information)


	Three Months Ended March 31,
	2024		2023
Numerator
Net income	$	64,332	$	33,311
Denominator
Weighted average common shares outstanding - basic		31,808,959		31,914,414
Dilutive effect of stock-based compensation awards		429,849		202,668
Weighted average common shares outstanding - diluted		32,238,808		32,117,082
Earnings per share:
Basic	$	2.02	$	1.04
Diluted	$	2.00	$	1.04

Adjusted earnings per share
Numerator
Net income	$	64,332	$	33,311
Income tax expense		19,988		10,698
Income before income tax expense		84,320		44,009
Inventory impairment		—		—
Impairment on other investment		7,722		—
Purchase price accounting for acquired work in process inventory		1,581		—
Adjusted income before income tax expense		93,623		44,009
Adjusted income tax expense⁽¹⁾		(22,193)		(10,698)
Adjusted net income	$	71,430	$	33,311

Denominator - Diluted		32,238,808		32,117,082

Adjusted diluted earnings per share	$	2.22	$	1.04

⁽¹⁾The tax rates used in calculating adjusted net income for the three months ended March 31, 2024 and 2023 were 23.7% and 24.3%, respectively, which are reflective of our GAAP tax rates for the applicable periods.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Interest Rates

Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates, foreign currency exchange rates and commodity prices. Our primary exposure to market risk is interest rate risk associated with our Second A&R Credit Agreement and construction loan agreements. There have been no material changes in our market risk since December 31, 2023. For additional information regarding our market risk, refer to the “Quantitative and Qualitative Disclosures About Market Risk” section of our Annual Report on Form 10-K for the year ended December 31, 2023.

Inflation

Our homebuilding operations have been and may continue to be adversely impacted by inflation, primarily from higher land, financing, labor, material, and construction costs. In addition, inflation has led and could continue to lead to higher mortgage rates, which has and could continue to significantly affect the affordability of mortgage financing to homebuyers and lead to weakened demand for our homes, as well as increased cancellations compared to prior year periods. Inflation remained elevated during the three months ended March 31, 2024.

Seasonality

Historically, the homebuilding industry experiences seasonal fluctuations in quarterly operating results and capital requirements. We typically experience the highest new home order activity during the spring, although this activity is also highly dependent on the number of active selling communities, timing of new community openings and other market factors. Since it typically takes four to five months to construct a new home, we typically deliver more homes in the second half of the year as spring and summer home starts convert to home deliveries. Because of this seasonality, home starts, construction costs and related cash outflows have historically been highest in the second and third quarters, and the majority of our cash receipts from home deliveries occurs during the second half of the year. This seasonality pattern may be affected by volatility in the homebuilding industry, supply chain challenges, and changes in demand for our homes.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our co-principal executive officers and principal financial officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures (as such term is defined under Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (which we refer to as the “Exchange Act”)) as of March 31, 2024, the end of the period covered by this Form 10-Q. Based on this evaluation, our co-principal executive officers and principal financial officer concluded that our disclosure controls and procedures were effective as of March 31, 2024 in providing reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Changes in Internal Control over Financial Reporting

There were no changes during the first quarter of 2024 in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

Because of the nature of the homebuilding business, we and certain of our subsidiaries and affiliates have been named as defendants in various claims, complaints and other legal actions arising in the ordinary course of business. In the opinion of our management, the outcome of these ordinary course matters will not have a material adverse effect upon our financial condition, results of operations or cash flows.

ITEM 1A. RISK FACTORS.

There have been no material changes to the risk factors we previously disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 that was filed with the SEC on February 5, 2024.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

The following table summarizes the number of shares of our common stock that were purchased by us during each of the three fiscal months in our first quarter ended March 31, 2024.


	Total number of shares purchased ⁽¹⁾	Average price paid per share ⁽²⁾		Total number of shares purchased as part of publicly announced plans or programs	Maximum number of shares that may yet be purchased under the plans or programs
January
January 1, 2024 through January 31, 2024	—	$	—	—		1,230,010
February
February 1, 2024 through February 29, 2024	186,887		86.16	186,887		1,043,123
March
March 1, 2024 through March 31, 2024	—		—	—		1,043,123
Total	186,887	$	86.16

(1)On November 6, 2018, our Board of Directors authorized a stock repurchase program, under which we may repurchase up to 4,500,000 shares of our outstanding common stock. Under the terms of the program, the shares may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws. This program has no expiration date but may be terminated by the Board of Directors at any time. We repurchased 186,887 shares during the period indicated above under this program and 1,043,123 shares remained available to repurchase under this program as of March 31, 2024.

(2)The Inflation Reduction Act of 2022, which was enacted into law on August 16, 2022, imposed a nondeductible 1% excise tax on the net value of certain stock repurchases made after December 31, 2022. All dollar amounts presented exclude such excise taxes, as applicable.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

Indemnification Agreement with Interim Chief Financial Officer

Effective as of March 22, 2024, we entered into a standard and customary indemnification agreement with our Interim Chief Financial Officer, J. Scott Dixon, which agreement is in substantially the same form as the indemnification agreement with our other executive officers and directors. Like the other agreements, this agreement requires us to indemnify Mr. Dixon to the fullest extent permitted under Delaware law against liabilities that may arise by reason of his service to us and to advance expenses incurred as a result of any proceeding against him as to which he could be indemnified. We believe these indemnification agreements facilitate our ability to continue to attract and retain qualified individuals to serve as directors and officers.

The foregoing summary of the indemnification agreement is qualified in its entirety by reference to the complete text of the form of indemnification, which is filed as Exhibit 10.1 to this report and incorporated by reference herein.

Consulting Agreement with Former Chief Financial Officer

On March 18, 2024 but effective as of March 23, 2024, we entered into a three-month consulting agreement with our former Chief Financial Officer, David L. Messenger, to assist with the transition of his duties and responsibilities and ensure a seamless transition. Either party may terminate this agreement prior to its expiration at any time and for whatever reason. Under the agreement, we agreed to pay Mr. Messenger a monthly consulting fee of $50,000.

The foregoing summary of the consulting agreement is qualified in its entirety by reference to the complete text of the consulting agreement, which is filed as Exhibit 10.2 to this report and incorporated by reference herein.

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Rule 10b5-1 Plan and Non-Rule 10b5-1 Trading Arrangement Adoptions, Terminations, and Modifications

During the three months ended March 31, 2024, none of our directors or “officers” (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of SEC Regulation S-K.

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ITEM 6. EXHIBITS.

The following exhibits are either filed or furnished herewith or incorporated herein by reference:

Item No.		Description
3.1		Restated Certificate of Incorporation of Century Communities, Inc. (incorporated by reference to Exhibit 3.1 to Century Communities, Inc.’s Quarterly Report on Form 10-Q for quarter ended September 30, 2023 (File No. 001-36491)).
3.2		Amended and Restated Bylaws of Century Communities, Inc., effective November 9, 2022 (incorporated by reference to Exhibit 3.1 to Century Communities, Inc.’s Current Report on Form 8-K filed with the SEC on November 10, 2022 (File No. 001-36491)).
10.1		Form of Indemnification Agreement between Century Communities, Inc. and Each Director and Executive Officer (filed herewith)
10.2		Consulting Agreement dated as of March 23, 2024 between Century Communities, Inc. and David L. Messenger (filed herewith)
22.1		List of Guarantor Subsidiaries (filed herewith)
31.1		Certification of the Co-Principal Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended (filed herewith)
31.2		Certification of the Co-Principal Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended (filed herewith)
31.3		Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended (filed herewith)
32.1		Certification of the Co-Principal Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.2		Certification of the Co-Principal Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.3		Certification of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
101.INS		Inline XBRL Instance Document (the instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document)
101.SCH		Inline XBRL Taxonomy Extension Schema Document (filed herewith)
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document (filed herewith)
101.DEF		Inline XBRL Taxonomy Definition Linkbase Document (filed herewith)
101.LAB		Inline XBRL Taxonomy Extension Labels Linkbase Document (filed herewith)
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document (filed herewith)
104		Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Century Communities, Inc.



Date: April 24, 2024	By:	/s/ Dale Francescon
		Dale Francescon
		Chairman of the Board and Co-Chief Executive Officer
		(Co-Principal Executive Officer)

Date: April 24, 2024	By:	/s/ Robert J. Francescon
		Robert J. Francescon
		Co-Chief Executive Officer and President
		(Co-Principal Executive Officer)

Date: April 24, 2024	By:	/s/ J. Scott Dixon
		J. Scott Dixon
		Interim Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

DIRECTOR AND OFFICER

INDEMNIFICATION AGREEMENT

This DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENT (the “Agreement”), is made and entered into this ____ day of _____________, 20__ by and among Century Communities, Inc., a Delaware corporation (the “Company”), and the undersigned indemnitee (“Indemnitee”).

WHEREAS, it is essential to the Company that it be able to retain and attract as directors and officers the most capable individuals available;

WHEREAS, increased corporate litigation has subjected directors and officers to litigation risks and expenses, and the limitations on the availability and terms and conditions of directors and officers liability insurance can make it more difficult for the Company to attract and retain such individuals;

WHEREAS, the Company’s certificate of incorporation (as amended or amended and restated from time to time, the “Charter”), provides that a director or officer of the Company shall not be liable to the Company or its stockholders for monetary damages for breach of fiduciary duty except to the extent that such exemption or limitation is not permitted by the General Corporation Law of the State of Delaware (the “DGCL”);

WHEREAS, the Company’s Charter and Bylaws (as amended or amended and restated from time to time, the “Bylaws”), each require the indemnification of and advancement of expenses to the Company’s directors and officers under certain circumstances;

WHEREAS, under the DGCL, the Charter and Bylaws are not exclusive, and the Company is permitted to make other or additional indemnification and advancement agreements;

WHEREAS, to further promote the Company’s ability to attract and retain qualified individuals to serve as directors and/or officers of the Company, the Company will attempt to maintain directors and officers liability insurance to protect the Company’s directors and officers from certain liabilities;

WHEREAS, the Company desires that the Indemnitee serve and continue to serve as a director and/or officer of the Company;

WHEREAS, to promote the Company’s ability to attract and retain qualified individuals to serve as directors and/or officers of the Company, the Company desires to provide Indemnitee with specific contractual assurance of Indemnitee’s rights to indemnification and advancement of expenses to protect against litigation risks and expenses (regardless, among other things, of any change in the ownership of the Company or the composition of its Board of Directors); and

WHEREAS, Indemnitee is relying upon the rights afforded under this Agreement in accepting service and continuing to serve in Indemnitee’s position as a director and/or officer of the Company.

NOW, THEREFORE, in consideration of the promises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:

1. Definitions.

(a) “Change in Control” shall mean (i) any merger, consolidation, share exchange or business combination involving the Company or any of its subsidiary Entities, (ii) a sale, lease, exchange,

transfer or other disposition in a single transaction or a series of related transactions, of fifteen percent (15%) or more of the assets of the Company and its subsidiary Entities, taken as a whole, (iii) any issuance, purchase or sale of shares of capital stock or other securities representing fifteen percent (15%) or more of the voting power of the capital stock of the Company or any of its subsidiary Entities, including, without limitation, by way of tender or exchange offer, in a single transaction or a series of related transactions, (iv) any reorganization, recapitalization, liquidation or dissolution of the Company, or (v) any change in the composition of a majority of the Board of Directors of the Company in a single transaction or a series of related transactions, unless, in each case, such transaction described in subsections (i) - (v) hereof was adopted and approved by the members of the Board of Directors of the Company (or new or additional members of the Board of Directors of the Company nominated or approved by such directors) in office at the time of the adoption of this Agreement by the Company.

(b) “Corporate Status” describes the status of a person who is serving or has served (i) as a director or officer of the Company, (ii) in any capacity or service with respect to any employee benefit plan of the Company or any one or more of its subsidiary Entities, or (iii) as a director, officer, member, manager, partner, trustee, employee, or agent of any other Entity at the request of the Company.

(c) “Entity” shall mean any corporation, partnership (including, without limitation, any general, limited or limited liability partnership), joint venture, trust, enterprise, non-profit entity, limited liability company, trust, foundation, association, organization or other legal entity.

(d) “Expenses” shall mean all fees, costs and expenses reasonably incurred in connection with any Proceeding (as defined below, or any claim, issue or matter involved in any Proceeding), including, without limitation, reasonable attorneys’ fees, disbursements and retainers (including, without limitation, any such fees, disbursements and retainers incurred by Indemnitee pursuant to Sections 11 and 13 of this Agreement), fees, costs, expenses and disbursements of experts or expert witnesses, private investigators and professional advisors (including, without limitation, accountants and investment bankers), court costs, transcript costs, travel expenses (including, without limitation, those of experts or expert witnesses, private investigators and professional advisors), duplicating, printing and binding costs, internet, telephone and fax transmission charges, postage, delivery services, secretarial and administrative assistant services and other disbursements and expenses.

(e) “Liabilities” shall mean liabilities, judgments, damages, losses, penalties, excise taxes, fines and amounts paid in settlement.

(f) “Proceeding” shall mean any threatened, pending or completed claim, action, suit, proceeding, litigation, arbitration, mediation, alternate dispute resolution process, investigation, administrative hearing, or appeal, whether civil, criminal, administrative, arbitrative or investigative, whether formal or informal, including, without limitation, a Proceeding initiated by Indemnitee pursuant to Section 13 of this Agreement to enforce Indemnitee’s rights hereunder.

(g) “Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

(h) “Independent Counsel” means an attorney or firm of attorneys that is experienced in matters of corporate law and neither currently is, nor in the past five (5) years has been, retained to represent: (a) the Company, any subsidiary of the Company, or Indemnitee in any matter material to any such party (other than with respect to matters concerning Indemnitee under this Agreement and/or the indemnification provisions of the Company’s Charter or Bylaws, or of other indemnitees under similar indemnification agreements) or (b) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” does not

include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing the Company, any subsidiary of the Company, or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

2. Services of Indemnitee. In consideration of the Company’s covenants and obligations hereunder, Indemnitee agrees to serve or continue to serve as a director and/or officer of the Company. This Agreement, however, shall not impose any obligation on Indemnitee or the Company to continue Indemnitee’s service to the Company beyond any period otherwise required by law or by other agreements or commitments of the parties, if any.

3. Agreement to Indemnify and Hold Harmless. Except as set forth in Section 4 below, the Company shall and hereby does indemnify and hold harmless Indemnitee to the fullest extent permitted by law against all Expenses and Liabilities (referred to herein as “Indemnifiable Expenses” and “Indemnifiable Liabilities,” respectively, and collectively as “Indemnifiable Amounts”), and any and all federal, state, local or foreign taxes imposed as a result of the actual or deemed receipt of any payments under this Agreement actually and reasonably paid or incurred by Indemnitee or on Indemnitee’s behalf if, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant in, or otherwise requires representation of counsel in connection with, any Proceeding (including a Proceeding by or in the right of the Company), including, without limitation, all liability arising out of the negligence or active or passive wrongdoing of Indemnitee. For purposes of this Agreement, the meaning of the phrase “to the fullest extent permitted by law” will include to the fullest extent permitted by the DGCL or any statute that replaces or succeeds the relevant sections of the DGCL with respect to such matters, as the same exists or may hereafter be amended or interpreted (but in the case of any such amendment or interpretation, only to the extent that such amendment or interpretation permits the Company to provide broader indemnification rights than were permitted prior thereto).

4. Exceptions to Indemnification. Indemnitee shall be entitled to the indemnification provided in Section 3 above in all circumstances other than the following:

(a) Any Proceeding (or part of any Proceeding) initiated or brought voluntarily by Indemnitee against the Company or its directors, managers, officers, employees or other indemnitees, unless (i) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation, (ii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law, (iii) the proceeding was initiated to establish or enforce a right to indemnification under this Agreement, any other agreement or insurance policy, or under the Company’s Charter and Bylaws, or (iv) as otherwise required under the laws of the State of Delaware; provided, however, that nothing in this Section 4(a) shall limit the right of Indemnitee to be indemnified under Section 13; and

(b) If indemnification is sought by Indemnitee under Section 3 and the Company reasonably determines that indemnification of Indemnitee would violate the securities laws of the United States, including without limitation (i) an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act or similar provisions of state statutory law or common law, or (ii) any reimbursement of the Company by the Indemnitee of any bonus or other incentive based or equity-based compensation or of any profits realized by the Indemnitee from the sale of securities of the Company, as required in each case under the Exchange Act (including any such reimbursements that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), or the payment to the Company of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 306 of the Sarbanes Oxley Act); or (iii) any reimbursement of the Company by Indemnitee of any compensation pursuant to any compensation recoupment or clawback policy adopted by the Board or the Compensation Committee of the Board, including but not limited to any such policy

adopted to comply with stock exchange listing requirements implementing Section 10D of the Exchange Act.

(c) In any circumstance where such indemnification has been determined to be prohibited by law by a final (not interlocutory) judgment or other adjudication of a court or arbitration or administrative body of competent jurisdiction as to which there is no further right or option of appeal or the time within which an appeal must be filed has expired without such filing.

5. Notice By Indemnitee; Determination of Right to Indemnification.

(a) Notice by Indemnitee. Indemnitee agrees to notify the Company promptly in writing upon being served with any summons, citation, subpoena, complaint, indictment, information, or other document relating to any Proceeding or any claim, issue or matter involved in any Proceeding which may result in the indemnification of Indemnifiable Amounts or the advancement of Expenses hereunder; provided, however, that the failure to give any such notice shall not disqualify Indemnitee from the right, or otherwise affect in any manner any right of Indemnitee, to receive indemnification of Indemnifiable Amounts or advancements of Expenses hereunder, except to the extent the Company’s ability to defend in such Proceeding or such claim, issue or matter is materially prejudiced thereby.

(b) Determination of Right to Indemnification. Upon written request by Indemnitee for indemnification pursuant to Section 5(a) with respect to any Proceeding, a determination with respect to Indemnitee’s entitlement thereto shall be made by one of the following methods: (a) so long as there are Disinterested Directors with respect to such Proceeding, a majority vote of the Disinterested Directors, even if less than a quorum of the Board of Directors, (b) so long as there are Disinterested Directors with respect to such Proceeding, a committee of such Disinterested Directors designated by a majority vote of such Disinterested Directors, even though less than a quorum of the Board of Directors or, (c) if there are no Disinterested Directors, by an Independent Counsel retained by the Board of Directors provided as a written opinion delivered to the Board of Directors, a copy of which will also be delivered to Indemnitee.

6. Defense of the Underlying Proceeding. The Company shall have the right, but not the obligation, to defend Indemnitee in any Proceeding or any claim, issue or matter involved in any Proceeding which may give rise to the indemnification of Indemnifiable Amounts hereunder; provided, however, that the Company shall notify Indemnitee of any such decision to defend within ten (10) calendar days of the Company’s receipt of notice of any such Proceeding or such claim, issue or matter under Section 5(a) above. The Company shall not, without the prior written consent of Indemnitee, consent to the entry of any judgment against Indemnitee or enter into any settlement or compromise which (i) includes an admission of fault of Indemnitee, or (ii) does not include, as an unconditional term thereof, the full release of Indemnitee from all liability in respect of such Proceeding or such claim, issue or matter, which release shall be in form and substance reasonably satisfactory to Indemnitee. This Section 6 shall not apply to a Proceeding or any claim, issue or matter involved in a Proceeding brought by Indemnitee under Section 13(a) below.

(a) Consent to Judgment or Settlement or Compromise by Indemnitee. Indemnitee shall not, without the prior written consent of the Company (which consent shall not be unreasonably withheld or delayed), consent to the entry of any judgment against Indemnitee or consent to or enter into any settlement or compromise with respect to any Proceeding or any claim, issue or matter involved in any Proceeding with respect to which the Company may have indemnification or advancements obligations to Indemnitee hereunder. The Company shall have no obligation to indemnify Indemnitee under this Agreement with respect to any Proceeding or any claim, issue or matter involved in any Proceeding for which a judgment, settlement or compromise is consented to or entered into by Indemnitee without the prior written consent of the Company (which consent shall not be unreasonably withheld or delayed).

7. Procedure for Indemnification of Indemnifiable Amounts.

(a) Indemnitee shall, following the final disposition of the Proceedings, by settlement and/or final adjudication by a court of competent jurisdiction evidenced by a final nonappealable order, submit to the Company a written claim specifying the Indemnifiable Amounts for which Indemnitee seeks indemnification under Section 3 of this Agreement and the basis for such claim. At the reasonable request of the Company, Indemnitee shall furnish such documentation and information as are reasonably available to Indemnitee and necessary to establish that Indemnitee is entitled to indemnification hereunder, and the Company shall pay any Expenses actually and reasonably incurred by Indemnitee in furnishing such documentation and information.

(b) Subject to Section 4 above, the Company shall pay such Indemnifiable Amounts to Indemnitee within thirty (30) calendar days after receipt of such written claim.

8. Indemnification for Expenses of a Participant. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, a participant (as a deponent, witness or otherwise) in any Proceeding to which Indemnitee was or is not a party or was or is not threatened to be made a party, the Indemnitee shall be indemnified as provided in Section 3 hereof.

9. Indemnification for Expenses of a Party Who is Wholly or Partly Successful.

(a) Notwithstanding any other provision of this Agreement, and without limiting any such provision, to the extent that Indemnitee was or is, by reason of Indemnitee’s Corporate Status, a party to and was or is successful, on the merits or otherwise, as to any Proceeding or any claim, issue or matter involved in any Proceeding, Indemnitee shall be indemnified against all Expenses actually and reasonably incurred with respect to such Proceeding or such claim, issue or matter, as applicable. In furtherance and not in limitation of the foregoing, and by way of further explanation, if Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters involved in such Proceeding, the Company shall indemnify Indemnitee against all Expenses with respect to each successfully resolved claim, issue or matter.

(b) For purposes of this Section 9, “successful” shall take the broadest meaning permitted by law, and include, but not be limited to, (i) a verdict, adjudication, ruling, determination, judgment, order or other final decision on the merits by a court or arbitrator or other tribunal, as applicable, from which there is no further right to appeal, finding no liability on the part of Indemnitee; (ii) a termination, withdrawal or dismissal (with or without prejudice and by settlement or otherwise) of any Proceeding or any claim, issue or matter involved in any Proceeding, without any express finding of liability or guilt against Indemnitee, and (ii) the expiration of 120 days after the making of any claim or threat of any Proceeding without the institution of same and without the entering into of any settlement or compromise with respect to such claim or threat.

10. Effect of Certain Resolutions; Waiver of Right of Contribution Against Indemnitee. Neither the termination of any Proceeding or any claim, issue or matter involved in any Proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, nor the failure of the Company to award indemnification or to determine that indemnification is payable, shall create a presumption that Indemnitee is not entitled to indemnification hereunder. The Company hereby waives, to the fullest extent permitted by law, any right of contribution that it may have against Indemnitee with respect to any Proceeding or any claim, issue or matter involved in any Proceeding in which the Company and Indemnitee are jointly liable.

11. Agreement to Advance Expenses; Conditions.

(a) Except as set forth in Section 11(b), the Company will, if requested by Indemnitee, advance, to the fullest extent permitted by Delaware law, to Indemnitee (hereinafter an “Expense Advance”) any and all Expenses actually and reasonably paid or incurred by Indemnitee in connection with any Proceeding (whether prior to or after its final disposition). Indemnitee’s right to each Expense Advance will not be subject to the satisfaction of any standard of conduct and will be made without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement, or under provisions of the Company’s Charter or Bylaws or otherwise. Each Expense Advance will be unsecured and interest free and will be made by the Company without regard to Indemnitee’s ability to repay the Expense Advance. Indemnitee hereby undertakes to repay such Expense Advance if, and to the extent that, it is ultimately determined, by final decision by a court or arbitrator, as applicable, from which there is no further right to appeal, that Indemnitee is not entitled to be indemnified for such Expenses under the Company’s Charter and Bylaws, the DGCL, this Agreement or otherwise. Indemnitee shall qualify for an Expense Advance upon the execution and delivery of this Agreement by or on behalf of Indemnitee, which shall constitute the requisite undertaking with respect to repayment of an Expense Advance made hereunder and no other form of undertaking shall be required to qualify for an Expense Advance made hereunder other than the execution of this Agreement by or on behalf of Indemnitee. An Expense eligible for an Expense Advance will include (i) any and all reasonable Expenses incurred pursuing an action to enforce the right of advancement provided for in Section 13, including Expenses incurred preparing and forwarding statements to the Company to support the Expense Advances claimed, and (ii) notwithstanding anything herein to the contrary, any advance of expenses provided for in Section 13.

(b) Indemnitee will not be entitled to any Expense Advance in connection with any of the matters for which indemnity is excluded pursuant to Section 3 or 4.

12. Procedure for Advancement of Expenses. Indemnitee shall submit to the Company a written claim specifying the Expenses for which Indemnitee seeks advancement under Section 11 of this Agreement, and the basis for such claim, together with documentation evidencing that Indemnitee has actually and reasonably incurred such Expenses. The Company shall, if requested by Indemnitee and to the fullest extent permitted by law, advance such Expenses to Indemnitee or on behalf of Indemnitee within thirty (30) calendar days after receipt of such written claim and documentation.

13. Remedies of Indemnitee.

(a) Right to Petition Court. In the event that Indemnitee submits to the Company a written claim for indemnification of Indemnifiable Amounts under Sections 3 and 7 above or submits to the Company a written claim for advancement of Expenses under Sections 11 and 12 above, and the Company fails to make such indemnification or advancement, as applicable, pursuant to the terms of this Agreement, Indemnitee may petition the Court of Chancery of the State of Delaware (the “Court of Chancery”), to enforce the Company’s obligations under this Agreement.

(b) Burden of Proof. In any judicial proceeding brought under Section 13(a) above, the Company shall have the burden of proving that Indemnitee is not entitled to indemnification of Indemnifiable Liabilities or Indemnifiable Expenses, as applicable, hereunder.

(c) Expenses. The Company agrees to reimburse Indemnitee in full for any Expenses actually and reasonably incurred by Indemnitee in connection with investigating, preparing for, litigating, defending, prosecuting or settling any judicial proceeding brought by Indemnitee under Section 13(a) above, except where such judicial proceeding or any claim, issue or matter involved therein is adjudicated

finally by a court of competent jurisdiction evidenced by a final nonappealable order in favor of the Company.

(d) Validity of Agreement. The Company shall be precluded from asserting in any Proceeding, including, without limitation, an action under Section 13(a) above, that the provisions of this Agreement are not valid, binding and enforceable or that there is insufficient consideration for this Agreement and shall stipulate in such court that the Company is bound by all the provisions of this Agreement.

(e) Failure to Act Not a Defense. The failure of the Company (including, without limitation, its Board of Directors or any committee thereof, independent legal counsel, or stockholders) to make a determination concerning the permissibility of the indemnification of Indemnifiable Amounts shall not be a defense in any action brought under Section 13(a) above, and shall not create a presumption that such indemnification is not permissible hereunder.

14. Representations and Warranties of the Company. The Company hereby represents and warrants to Indemnitee as follows:

(a) Authority. The Company has all necessary power and authority to enter into, and be bound by the terms of, this Agreement, and the execution, delivery and performance of the undertakings contemplated by this Agreement have been duly authorized by the Company.

(b) Enforceability. This Agreement, when executed and delivered by the Company in accordance with the provisions hereof, shall be a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the enforcement of creditors’ rights generally or equitable principles.

15. Insurance. The Company shall cover Indemnitee under any insurance policy secured for the directors and officers of the Company or other Entity for which Indemnitee has Corporate Status.

16. Contract Rights Not Exclusive. The rights to indemnification of Indemnifiable Amounts and advancement of Expenses provided by this Agreement shall be in addition to, but not exclusive of, any other rights which Indemnitee may have at any time under applicable law or the Charter or Bylaws, or any other agreement, vote of stockholders or directors (or a committee of directors), or otherwise, both as to action in Indemnitee’s official capacity and as to action in any other capacity as a result of Indemnitee’s serving as a director and/or officer of the Company.

17. Successors. This Agreement shall be (a) binding upon all successors and assigns of the Company (including, without limitation, to the fullest extent permitted by law, any transferee of all or a substantial portion of the business, stock and/or assets of the Company and any direct or indirect successor by merger or consolidation or otherwise by operation of law), and (b) binding on and shall inure to the benefit of the heirs, personal representatives, executors and administrators of Indemnitee. To the fullest extent permitted by applicable law, the Company shall cause any successor to the business, stock and/or assets of the Company (whether by operation of law or otherwise) to assume and agree to perform this Agreement in the same manner as if no such succession had taken place. This Agreement shall continue for the benefit of Indemnitee and the heirs, personal representatives, executors and administrators of Indemnitee after Indemnitee has ceased to have Corporate Status.

18. Other Sources; Subrogation. The Company’s obligation to indemnify or advance Expenses to Indemnitee, if any, hereunder shall be reduced by the amount Indemnitee may receive, as

indemnification or advancement of Expense from any other Entity or individual or any insurance policy. In the event of any indemnification of Indemnifiable Amounts or advancement of Expenses by the Company under this Agreement, the Company shall, to the fullest extent permitted by law, be subrogated to the extent of such indemnification or advancement to all of the rights of contribution or recovery of Indemnitee against other Entities or individuals and have a right of contribution against such other Entities or individuals, and, in furtherance thereof, Indemnitee shall take, at the request of the Company, all reasonable action necessary to secure such rights, including, without limitation, securing the execution and delivery by such other Entities or individuals of an agreement as to the division of indemnification and advancement liabilities as between such other Entities or individuals and the Company, in a manner reasonably acceptable to the Company prior to the payment by the Company of any such Indemnifiable Amounts or Expenses and/or the execution and delivery of such documents as are reasonably necessary to enable the Company to bring suit to enforce such rights.

19. Governing Law; Change in Law; Jurisdiction. This Agreement shall be governed by and construed and enforced under the laws of the State of Delaware, without giving effect to the provisions thereof relating to conflicts of law. The parties hereto waive any right to a trial by jury. To the fullest extent permitted by applicable law, the parties hereto (i) irrevocably submit to the exclusive personal jurisdiction of the Delaware Court of Chancery, and (ii) waive any claim of improper venue or any claim that the Court of Chancery is an inconvenient forum in any action to interpret, apply, or enforce the provisions of this Agreement or the rights, obligations or liabilities of the parties hereto. To the fullest extent permitted by applicable law, the parties hereby agree that the mailing of process and other papers in connection with any such proceeding in the manner provided in Section 22 below or in such other manner as may be permitted by law, shall be valid and sufficient service thereof.

20. Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement, or any clause thereof, shall be determined by a court of competent jurisdiction to be illegal, invalid or unenforceable, in whole or in part, such provision or clause shall be limited or modified in its application to the minimum extent necessary to make such provision or clause valid, legal and enforceable, and the remaining provisions and clauses of this Agreement shall remain fully enforceable and binding on the parties.

21. Modifications and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by each of the parties hereto. Notwithstanding any other provision of this Agreement or any provision of law to the contrary, to the fullest extent permitted by law, no supplement, modification or amendment of this Agreement shall adversely affect any right or protection of Indemnitee in respect of any act or omission occurring prior to the time of such supplement, modification or amendment. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions of this Agreement (whether or not similar), nor shall such waiver constitute a continuing waiver.

22. General Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given (i) when delivered by hand, (ii) when transmitted by electronic mail or facsimile and receipt is acknowledged, (iii) if sent by a reputable overnight courier, on the next business day after the date on which it is so sent; or (iv) if mailed by certified or registered mail with postage prepaid, on the third (3rd) business day after the date on which it is so mailed, in each case, to such address as may have been furnished by either party to the other.

23. Termination. This Agreement shall terminate as of the later of (i) ten (10) years after Indemnitee ceases to serve as a director and/or officer of the Company, or (ii) one (1) year after the final adjudication by a court of competent jurisdiction evidenced by a final non-appealable order with respect to

any Proceeding or any claim, issue or matter involved in any Proceeding in respect of which Indemnitee is granted rights of indemnification or advancement of expenses hereunder.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have executed this Director and Officer Indemnification Agreement as of the date first above written.

THE COMPANY:

CENTURY COMMUNITIES, INC.

Name:

Title:

INDEMNITEE:

[Name of Director/Officer]

[SIGNATURE PAGE TO DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENT]

CONSULTING AGREEMENT

This consulting Agreement (this “Agreement”) is made to be effective as of March 23, 2024 (the “Effective Date”) by and between Century Communities, Inc., a Delaware corporation (“Century”), and David L. Messenger (“Consultant”).

1.Engagement of Consultant. Beginning on the Effective Date, Century engages Consultant to provide consulting services to Century, and Consultant agrees to provide consulting services to Century, subject to the terms and conditions of this Agreement.

2.Term of the Agreement. The term of this Agreement will be for three months beginning on March 23, 2024 and terminating June 23, 2024, subject to earlier termination as set forth in Section 8 hereof.

3.Services.

3.1Consultant will provide consulting services (the “Services”) and where applicable, related deliverables (“Deliverables”) to Century as specified in the “Scope of Work” attached hereto as Exhibit A.

3.2Whenever reasonably requested to do so by Century, Consultant agrees to (a) make himself available to perform the Services and/or (b) appear in person at the offices of Century or any other location designated by Century. Whenever Consultant is on Century’s premises or performing the Services hereunder, Consultant agrees to conduct himself in a professional manner and abide by all applicable Century rules, policies and procedures, including Century’s Code of Conduct.

4.Compensation.

4.1In consideration of the performance of the Services set forth in Exhibit A provided by Consultant and the terms and conditions herein, Century will pay Consultant a consulting fee, in the amount and in accordance with the provisions of Exhibit A.

4.2Century will reimburse Consultant for reasonable expenses incurred by Consultant in providing the Services, provided that such expenses are approved in advance. Consultant will invoice Century for the reimbursement of such expenses incurred during the previous two-week period and will attach receipts for such expenses attached to the invoices. Invoices will be submitted to the attention of Century’s Interim Chief Financial Officer, and Century will pay such invoices within 15 days after its receipt thereof.

4.3Other than as provided in this Agreement, Century’s financial obligations under this Agreement shall be limited to the payment of the compensation provided in this Agreement. Notwithstanding any other provision of this Agreement, in no event, shall Century be liable, regardless of whether any claim is based on contract or tort, for any (a) indirect, special, exemplary, consequential, incidental or punitive damages, even if that party has been advised of the possibility of such damages; and/or (b) lost profits, lost revenues, lost business expectancy, business interruption losses and/or benefit of the bargain damages.

5.Independent Contractor Status. The Services to be provided by Consultant hereunder will be those of an independent contractor, and Consultant will not be regarded as, nor will Consultant hold himself/herself out to be, an agent or employee of Century for any purpose.

5.1Consultant is solely responsible for all taxes, withholdings, and other statutory, regulatory or contractual obligations of any sort (including, but not limited to, those relating to workers’ compensation, disability insurance, Social Security, unemployment compensation coverage, income taxes, etc.) in connection with the Services performed under this Agreement. Consultant agrees to hold Century harmless from loss or liability which may arise from the failure of Consultant to comply with such laws or regulatory or contractual obligations. In addition, Consultant is not entitled to participate in Century’s employee benefit plans, bonus programs, group insurance arrangements or similar programs. Without limiting the preceding sentences, Consultant shall not receive any vacation pay, sick leave, paid time off, or other paid or unpaid leave of absence, or workers’ compensation benefits, and no entitlement to any employee benefits shall be implied from this Agreement.

5.2Consultant will have the right to determine the means and methods of performing the Services hereunder.

5.3Consultant acknowledges that Consultant does not have the authority to incur any financial obligations or make other commitments on behalf of Century and agrees not to sign any documents or make any commitments on behalf of Century.

5.4CERTIFICATION: CONSULTANT ACKNOWLEDGES AND UNDERSTANDS THAT HE:

• WILL NOT BE ENTITLED TO ANY WORKERS’ COMPENSATION BENEFITS IN THE EVENT OF INJURY.

• IS OBLIGATED TO PAY ALL FEDERAL AND STATE INCOME TAX ON ALL MONEY EARNED WHILE PERFORMING SERVICES FOR CENTURY. Century will not make any payroll deductions from the payments due Consultant hereunder.

Consultant acknowledges the terms of the above section.

CONSULTANT’S INITIALS: ____/s/ DM_____________

6.Intellectual Property Rights. The Deliverables resulting from the Services provided by Consultant under this Agreement, including without limitation, posters, maps, charts, motion pictures, publications, plans, specifications, drawings, models, paintings, prints, sculpture, sketches, applied art, studies, names, logos, advertising materials, marketing materials, software and reports of all kinds, together with all modifications thereto, shall for all purposes belong to, and be owned exclusively by Century (including its Affiliates). All Deliverables shall be the original work of Consultant and shall not infringe upon the rights of patent, trademark, or copyright of any other person. To the extent permitted by Applicable Law, all Deliverables shall be deemed “works made for hire” owned by Century. In any event, and without cost to Century, Consultant hereby irrevocably transfers and assigns to Century, the entire right, title and interest in all such works, and all copyright, trademark, patent and other rights therein throughout the world, including without limitation, the right to all copies thereof (e.g., negatives, sketches, drafts, originals) and all of the exclusive rights listed in 17 U.S.C. §106 or provided for under the laws of any foreign country. From time-to-time hereafter, Consultant, without cost to Century, will promptly execute further assignments as may be reasonably necessary to ensure exclusive ownership by Century of all Deliverables, developed by the Services of Consultant under this Agreement.

7.Confidential Information. Consultant will treat as confidential all information and/or materials about, relating to or concerning Century, its owners, affiliates and/or subsidiaries (“Confidential Information”), including, without limitation, oral and written information about, relating to or concerning Century, its owners, affiliates and/or subsidiaries, that (i) Century has by its policies or otherwise indicated should be kept confidential, (ii) should reasonably be deemed confidential by Consultant whether or not it was designated as confidential, or (iii) if disclosed could be injurious to Century, its owners, affiliates and/or subsidiaries. Consultant agrees not to use Confidential Information for any personal or professional purpose except as contemplated by this Agreement. Consultant will not disclose any Confidential Information to any other person or entity without the prior written consent of Century or unless required by law. If Consultant receives a subpoena or other validly issued administrative or judicial process requesting Confidential Information, Consultant will promptly notify Century of such receipt and may comply with such subpoena or process to the extent permitted by law. Century acknowledges that information that is generally known in the homebuilding industry is not Confidential Information. All Confidential Information will remain the sole and exclusive property of Century. In the event Consultant breaches this Agreement, because of the unique nature of the Confidential Information, damages will not provide an adequate remedy for Century for such a breach. Therefore, in the event of a breach or threat of breach, the Century shall be entitled to injunctive relief. In addition, in the case of unauthorized use or disclosure of Confidential Information by Consultant, Century shall be entitled to recover as liquidated damages the total amount of compensation paid to Consultant pursuant to this Agreement. The amount of such liquidated damages is agreed by the Parties as a reasonable amount to compensate Century for losses to be incurred in the event of beach of this Agreement.

8.Termination.

8.1 Either party may terminate this Agreement at any time, with or without cause, for convenience provided, however, that Century shall, upon termination, pay to Consultant a prorated amount for all Services completed through the date of termination.

8.3The rights and obligations of the parties set forth in Sections 6, 7, and 9 of this Agreement and any remedies for breach of this Agreement shall survive any expiration or prior termination. Century may communicate such obligations to any other (or potential) client or employer of Consultant.

9.Arbitration. Consultant hereby agrees to submit to final and binding arbitration in Denver, Colorado any controversy or claim Consultant has or may have against Century, including any disputes relating to or in connection with this Agreement. Unless otherwise agreed, the arbitration will be conducted by the Judicial Arbiter Group in accordance with the Employment Dispute Resolution Rules of the American Arbitration Association; provided, however, that the arbitrator(s) is not authorized to issue a decision or award that a court of applicable jurisdiction could not legally award under applicable state or federal laws at the time. Century and Consultant further agree that the arbitrator’s award may be enforced by judgment in accordance with the Federal Arbitration Act. Disputes over whether a decision exceeds the authority of the arbitrator(s) will be decided by summary judgment proceedings in a court of competent jurisdiction. There will be no authority for any dispute between the parties to be arbitrated on a class action basis. Furthermore, arbitration can only decide a dispute between Consultant and Century and may not consolidate or join the claims of other persons that may have similar claims. THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN), OR ACTIONS OF ANY PARTY RELATED TO OR ARISING FROM THIS AGREEMENT.

10.Notices. Any notice given to the parties hereunder must be in writing and delivered to the other party (a) in person, (b) by e-mail (c) by overnight delivery service, or (d) by certified mail, return receipt requested. Notice given in person or by e-mail will be effective when received or successfully transmitted. Notice given by overnight delivery service will be effective the first business day following the deposit of such notice with the delivery service. Notice given by certified mail will be effective 3 business days after a certified letter containing such notice, properly addressed with postage prepaid, is deposited with the postal service. Notices to Century will be sent to the address set forth in the signature block noted below. Notices to Consultant will be sent to the address set forth in the signature block noted below. Any party may designate a different address by giving notice according to this Section.

11.Compliance with Laws. Consultant, at Consultant’s sole expense, shall obtain and maintain all necessary approvals, licenses and permits which are required to perform the Services. In addition, if Consultant becomes aware of any change in Applicable Laws affecting the Services to be performed hereunder, Consultant shall promptly notify Client of such change in writing.

12.Upon the Completion of the Term of this Agreement. Consultant shall perform the following activities:

12.1Consultant will coordinate with Century to deactivate any assigned access badge. In addition, Consultant will make every attempt possible to retrieve and return the access badge.

12.2If, during the course of an assignment, Century has provided Consultant with Century-owned equipment or job-related materials to complete this Agreement, Consultant shall return, or cause to be returned, all of Century’s equipment or materials upon the earlier of (i) termination of the Agreement, (ii) or (ii) Century’s demand for return of the equipment or materials.

13.Miscellaneous.

13.1All payments and benefits provided for under this Agreement are intended to be exempt from or otherwise comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance thereunder (together, “Section 409A”), so that none of the payments and benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities or ambiguous terms herein will be interpreted to be exempt or so comply. Each payment and benefit payable under this Agreement is intended to constitute a separate payment for purposes of Section 1.409A-2(b) (2) of the Treasury Regulations. In no event will the Company reimburse the Consultant for any taxes that may be imposed on the Consultant as a result of Section 409A.

13.2The parties agree that the terms of this Agreement are contractual in nature and not merely recitals and will be governed and construed in accordance with the laws of the State of Colorado. The parties further agree that should any part of this Agreement be determined by a court of competent jurisdiction to be illegal, invalid, or unenforceable, the parties intend the legality, validity and enforceability of the remaining parts will not be affected thereby, and any illegal, invalid, or unenforceable part will be deemed not to be a part of this Agreement.

13.3Nothing contained herein and no act by Century or Consultant in the performance of, or in any way related to, this Agreement will be construed to create or evidence in any manner any employment, partnership, agency or joint venture relationship between the parties hereto.

Century and Consultant represent and acknowledge that it is their mutual intention that the sole relationship created between them by this Agreement is described in Section 5 hereof.

13.4The headings contained in this Agreement are for reference purposes only and do not in any way affect the meaning or interpretation of any provision hereof.

13.5This Agreement and the attached Scope of Work expresses the entire agreement between Consultant and Century with reference to the subject matter hereof. No waiver or modification of this Agreement or of any covenant, condition or limitation herein contained will be valid, unless in writing and duly executed by the parties hereto.

13.6The terms and conditions hereof are hereby made binding on the successors and assigns of both parties hereto, provided that neither party may assign any right or delegate any duty hereunder without the prior written consent of the other party, such consent not to be unreasonably withheld, conditioned or delayed. Any assignment or delegation without such prior written consent will be void, and will be a breach hereunder, except that Century may assign its rights hereunder to another entity that is affiliated with Century.

[Remainder of page intentionally left blank; signature page follows]

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement to be effective as of the day and year first above written.

CONSULTANT:

David L. Messenger

/s/ David L. Messenger

Date: 3/14/24

Address for Notices:

CENTURY:

Century Communities, Inc.,

a Delaware corporation

By: /s/ Dale Francescon

Name: Dale Francescon

Title: Co-CEO

3/18/24

Date

Address for Notices:

Century Communities, Inc.

8390 E. Crescent Parkway, Suite 650

Greenwood Village, CO 80111

Attn: Jarrett Coleman, General Counsel

Email: Jarrett.Coleman@centurycommunities.com

EXHIBIT A

Scope of Work

Consultant will provide the following Services and Deliverables described below for the associated rate shown below:

Liaison with the Company’s Interim Chief Financial Officer and assist with the transition of the Company’s Chief Financial Officer duties and responsibilities to the Company’s Interim Chief Financial Officer.

Liaison with the Company’s General Counsel and assist with the transition of the Company’s Chief Compliance Officer duties and responsibilities to the Company’s General Counsel.

Liaison with the Company’s Co-Chief Executive Officers, and either of them, regarding the transition of Consultant’s other duties and responsibilities.

Meet by telephone, video conference or in person with members of the Company’s management as may be required or necessary in performing Consultant’s Services hereunder.

The Services shall be provided in accordance with all relevant laws, statutes, and regulations. In rendering the Services to Century as an independent contractor, Consultant shall not be under the supervision or control of Century with respect to the details, manner or means of performance except to the limited extent set forth in this Agreement. Nothing in this Agreement shall prevent or restrict Century from obtaining from any other person any services which are the same as or similar to the Services.

The Company and Consultant understand, acknowledge and agree that the Company is not required to request, and Consultant is not required to provide any minimum level of Services under this Agreement.

Payment/Rates

In consideration of the Services and rights and obligations set forth in this Exhibit A and the Consulting Agreement, Century shall pay Consultant a monthly fee of $50,000, which fees shall be payable monthly in arrears, and shall be paid by the Company within 30 days of the end of the month.

155999096.2

156722377.1

Exhibit 22.1

LIST OF SUBSIDIARY GUARANTORS

As of March 31, 2024, Century Communities, Inc. (referred to as the “Issuer”) had $500 million principal amount outstanding of 3.875% Senior Notes due August 2029 (referred to collectively as the “2029 Notes”) and $500 million principal amount outstanding of 6.75% Senior Notes due May 2027 (referred to collectively as the “2027 Notes” and collectively with the 2029 Notes, the “Senior Notes”). The Senior Notes are unsecured senior obligations of the Issuer and are fully and unconditionally guaranteed on an unsecured basis, jointly and severally, by substantially all of the Issuer’s direct and indirect wholly-owned operating subsidiaries (referred to collectively as “Guarantors”). The Issuer’s subsidiaries associated with its financial services operations do not guarantee the Senior Notes.

As of March 31, 2024, the entities set forth below, which are 100% owned subsidiaries of the Issuer, were guarantors of the outstanding Senior Notes. However, only the 2027 Notes and the related guarantees are registered securities under the Securities Act of 1933, as amended (the “Securities Act”). The offer and sale of the 2029 Notes and the related guarantees were not and will not be registered under the Securities Act or the securities laws of any other jurisdiction and instead were issued in reliance upon an exemption from such registration. Unless they are subsequently registered under the Securities Act, neither the 2029 Notes nor the related guarantees may be offered and sold only in transactions that are exempt from the registration requirements under the Securities Act and the applicable securities laws of any other jurisdiction.

As the guarantees for the 2027 Notes were made in connection with the issuance of the 2027 Notes and an exchange offer effected under the Securities Act in April 2017, the Guarantors’ condensed supplemental financial information is presented in the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024 as if the guarantees existed during the periods presented pursuant to applicable SEC rules and guidance. In addition, pursuant to such SEC rules and guidance, the information regarding the Guarantors as of March 31, 2024 is set forth below.


Name of Entity	State of Formation, Organization, or Incorporation
5280 Reinsurance, LLC	Arizona
Augusta Pointe, LLC	Colorado
Avalon at Inverness, LLC	Colorado
AVR A, LLC	Colorado
AVR B, LLC	Colorado
AVR C, LLC	Colorado
Beacon Pointe, LLC	Colorado
Benchmark Communities, LLC	Delaware
Blackstone Homes, LLC	Colorado
BMC East Garrison, LLC	Delaware
BMC EG Bluffs, LLC	Delaware
BMC EG Bungalow, LLC	Delaware
BMC EG Garden, LLC	Delaware
BMC EG Grove, LLC	Delaware

Name of Entity	State of Formation, Organization, or Incorporation
BMC EG Towns, LLC	Delaware
BMC EG Village, LLC	Delaware
BMC Realty Advisors, Inc	California
BMCH California, LLC	Delaware
BMCH Tennessee, LLC	Delaware
BMCH Washington, LLC	Delaware
Bradburn Village Homes, LLC	Colorado
Casa Acquisition Corp.	Delaware
CC Communities, LLC	Colorado
CC Southeast Constructors, LLC	North Carolina
CCC Holdings, LLC	Colorado
CCG Constructors LLC	Georgia
CCG Realty Group LLC	Georgia
CCH Homes, LLC	Colorado
CCNC Realty Group, LLC	North Carolina
CCSC Realty Group, LLC	South Carolina
Centennial Holding Company LLC	Colorado
Century at Anthology, LLC	Colorado
Century at Ash Meadows, LLC	Colorado
Century at Autumn Valley Ranch, LLC	Colorado
Century at Beacon Pointe, LLC	Colorado
Century at Belleview Place, LLC	Colorado
Century at Caley, LLC	Colorado
Century at Candelas, LLC	Colorado
Century at Carousel Farms, LLC	Colorado
Century at Castle Pines Town Center, LLC	Colorado
Century at Claremont Ranch, LLC	Colorado
Century at Colliers Hill, LLC	Colorado
Century at Compark Village North, LLC	Colorado
Century at Compark Village South, LLC	Colorado
Century at Coyote Creek, LLC	Colorado
Century at Forest Meadows, LLC	Colorado
Century at Harvest Meadows, LLC	Colorado
Century at Landmark, LLC	Colorado
Century at Littleton Village, LLC	Colorado
Century at Littleton Village II, LLC	Colorado

Name of Entity	State of Formation, Organization, or Incorporation
Century at LOR, LLC	Colorado
Century at Lowry, LLC	Colorado
Century at Marvella, LLC	Colorado
Century at Mayfield, LLC	Colorado
Century at Meadowbrook, LLC	Colorado
Century at Midtown, LLC	Colorado
Century at Millennium, LLC	Colorado
Century at Murphy Creek, LLC	Colorado
Century at Oak Street, LLC	Colorado
Century at Observatory Heights, LLC	Colorado
Century at Outlook, LLC	Colorado
Century at Pearson Grove, LLC	Colorado
Century at Salisbury Heights, LLC	Colorado
Century at Shalom Park, LLC	Colorado
Century at Southshore, LLC	Colorado
Century at Spring Valley Ranch, LLC	Colorado
Century at Tanglewood, LLC	Colorado
Century at Terrain, LLC	Colorado
Century at The Grove, LLC	Colorado
Century at the Heights, LLC	Colorado
Century at The Meadows, LLC	Colorado
Century at Vista Ridge, LLC	Colorado
Century at Wildgrass, LLC	Colorado
Century at Wolf Ranch, LLC	Colorado
Century at Wyndham Hill, LLC	Colorado
Century Building Supply, LLC	Colorado
Century City, LLC	Colorado
Century Communities Construction, LLC	Utah
Century Communities Construction of Arizona, LLC	Arizona
Century Communities Investments LLC	Colorado
Century Communities Merchandising Group, LLC	Colorado
Century Communities of Arizona, LLC	Arizona
Century Communities of California, LLC	Delaware
Century Communities of Florida, LLC	Colorado
Century Communities of Florida Realty Group, LLC	Delaware
Century Communities of Georgia, LLC	Colorado

Name of Entity	State of Formation, Organization, or Incorporation
Century Communities of Idaho, LLC	Colorado
Century Communities of Nevada, LLC	Delaware
Century Communities of Nevada Realty, LLC	Nevada
Century Communities of North Carolina, LLC	Delaware
Century Communities of South Carolina, LLC	Delaware
Century Communities of Tennessee, LLC	Delaware
Century Communities of Utah, LLC	Utah
Century Communities of Washington, LLC	Delaware
Century Communities Realty of Utah, LLC	Utah
Century Communities Southeast, LLC	Colorado
Century Couplet, LLC	Colorado
Century Land Holdings, LLC	Colorado
Century Land Holdings II, LLC	Colorado
Century Land Holdings of Texas, LLC	Colorado
Century Land Holdings of Utah, LLC	Utah
Century Lincoln Station, LLC	Colorado
Century Living at Compark, LLC	Colorado
Century Living at Verona LLC	Colorado
Century Living, LLC	Colorado
Century Townhomes at Candelas, LLC	Colorado
Century Tuscany GC, LLC	Delaware
Cherry Hill Park, LLC	Colorado
Cottages at Willow Park, LLC	Colorado
Crown Hill, LLC	Colorado
Enclave at Pine Grove, LLC	Colorado
Estates at Chatfield Farms, LLC	Colorado
Hearth at Oak Meadows, LLC	Colorado
Horizon Building Services, LLC	Colorado
Ladera, LLC	Colorado
Lakeview Fort Collins, LLC	Colorado
Lincoln Park at Ridgegate, LLC	Colorado
Meridian Ranch, LLC	Colorado
Montecito at Ridgegate, LLC	Colorado
Neighborhood Associations Group, LLC	Delaware
Park 5th Avenue Development Co., LLC	Colorado
Red Rocks Pointe, LLC	Colorado
Reserve at Highpointe Estates, LLC	Colorado
Reserve at The Meadows, LLC	Colorado

Name of Entity	State of Formation, Organization, or Incorporation
SAH Holdings, LLC	Colorado
Saddleback Heights, LLC	Colorado
Stetson Ridge Homes, LLC	Colorado
Summit Aviator Business Trust	Utah
Summit Aviator WY Statutory Trust	Wyoming
The Overlook at Tallyn’s Reach, LLC	Colorado
The Retreat at Ridgegate, LLC	Colorado
The Veranda, LLC	Colorado
UCP, LLC	Delaware
UCP Barclay III, LLC	Delaware
UCP East Garrison, LLC	Delaware
UCP Kerman, LLC	Delaware
UCP Meadowood III, LLC	Delaware
UCP Sagewood, LLC	Delaware
UCP Tapestry, LLC	Delaware
Venue at Arista, LLC	Colorado
Verona Estates, LLC	Colorado
Villas at Murphy Creek, LLC	Colorado
Waterside at Highland Park, LLC	Colorado
Westown Condominiums, LLC	Colorado
Westown Townhomes, LLC	Colorado
Wildgrass, LLC	Colorado
WJH LLC	Delaware
WJH LLC of Delaware	Delaware
WJH Brokerage OH LLC, D/B/A Wade Jurney Homes	Ohio
WJH Brokerage TX LLC	Texas
WJH Brokerage MI LLC	Michigan
WJH Sales of AZ LLC	Arizona
WJHAL LLC	Alabama
WJHID LLC	Idaho
WJHKY LLC	Kentucky
WJH Brokerage AZ LLC	Arizona
WJH Brokerage FL LLC	Florida
WJH Brokerage IA LLC	Iowa
WJH Brokerage IN LLC	Indiana
WJH Brokerage NC LLC	North Carolina
WJH Brokerage NC LLC	Texas
WJHAZ LLC	Arizona

EXHIBIT 31.1

CERTIFICATION OF CO-PRINCIPAL EXECUTIVE OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Dale Francescon, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Century Communities, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: April 24, 2024		/s/ Dale Francescon
		Dale Francescon
		Chairman of the Board and Co-Chief Executive Officer (Co-Principal Executive Officer)

EXHIBIT 31.2

CERTIFICATION OF CO-PRINCIPAL EXECUTIVE OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Robert J. Francescon, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Century Communities, Inc.;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: April 24, 2024		/s/ Robert J. Francescon
		Robert J. Francescon
		Co-Chief Executive Officer and President (Co-Principal Executive Officer)

EXHIBIT 31.3

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, J. Scott Dixon, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Century Communities, Inc.;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: April 24, 2024		/s/ J. Scott Dixon
		J. Scott Dixon
		Interim Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

EXHIBIT 32.1

CERTIFICATION OF CO-PRINCIPAL EXECUTIVE OFFICER PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Century Communities, Inc. (the “Company”) for the quarterly period ended March 31, 2024, as filed with the U.S. Securities and Exchange Commission on the date hereof (the “Quarterly Report”), I, Dale Francescon, Chairman of the Board and Co-Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. the Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: April 24, 2024		/s/ Dale Francescon
		Dale Francescon
		Chairman of the Board and Co-Chief Executive Officer (Co-Principal Executive Officer)

EXHIBIT 32.2

CERTIFICATION OF CO-PRINCIPAL EXECUTIVE OFFICER PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Century Communities, Inc. (the “Company”) for the quarterly period ended March 31, 2024, as filed with the U.S. Securities and Exchange Commission on the date hereof (the “Quarterly Report”), I, Robert J. Francescon, Co-Chief Executive Officer and President of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. the Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: April 24, 2024		/s/ Robert J. Francescon
		Robert J. Francescon
		Co-Chief Executive Officer and President (Co-Principal Executive Officer)

EXHIBIT 32.3

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Century Communities, Inc. (the “Company”) for the quarterly period ended March 31, 2024, as filed with the U.S. Securities and Exchange Commission on the date hereof (the “Quarterly Report”), I, J. Scott Dixon, Interim Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. the Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: April 24, 2024		/s/ J. Scott Dixon
		J. Scott Dixon
		Interim Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)